Natural Gas Price Forecast – Gapped Lower as Hurricane Blows ByThe natural gas markets have gapped lower during the trading session on Wednesday, as we have broken down towards the $2.65 level.
Natural gas markets have gapped lower to kick off the trading session on Wednesday as we have gotten past the hurricane in the Gulf of Mexico yet again. Having said that, there is still plenty of support underneath and I think that it is only a matter of time before we get buyers again. After all, the market is going to be looking at the natural gas markets through the prism of colder temperatures in the next few months, so I do think that it is only a matter of time before we get an opportunity to get long again.
NATGAS Video 15.10.20
Currently, the 50 day EMA is sitting at the $2.50 level, which of course is a psychologically important figure. I think at this point time, it is only a matter of time before we pull back and then find buyers yet again. In fact, we are already starting to see a little bit of a bounce near the $2.60 level. Given enough time, the $3.00 level above is a large, round, psychologically significant figure that will continue to cause issues. I do think that the market is very attracted to that level, and as we are trading the November contract people are starting to look at the idea of picking up value.
Trading Derivatives carries a high level of risk to your capital and you should only trade with money you can afford to lose. Trading Derivatives may not be suitable for all investors, so please ensure that you fully understand the risks involved, and seek independent advice if necessary. A Product Disclosure Statement (PDS) can be obtained either from this website or on request from our offices and should be considered before entering into a transaction with us. Raw Spread accounts offer spreads from 0.0 pips with a commission charge of USD $3.50 per 100k traded. Standard account offer spreads from 1 pips with no additional commission charges. Spreads on CFD indices start at 0.4 points. The information on this site is not directed at residents in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
The next couple of months should feature cold weather that people will use to drive natural gas higher as is the cyclical trade. However, by the time we get into the early part of next year, we will be trading spring contracts, which of course will drive this pair right back down. In the short term, I like buying short-term pullbacks.
For a look at all of today’s economic events, check out our economic calendar.