Natural Gas Price Forecast – has natural gas finally exhausted itself?

Natural gas markets rallied significantly during the early hours on Monday but found a bit of resistance near the $3.90 level. The market has gotten far ahead of itself, and of course we have a gap below underneath that should be filled given enough time.
Christopher Lewis
Natural gas Midday daily chart, November 13, 2018

The natural gas markets rallied a bit during the trading session on Monday, reaching towards the $3.90 level, which of course is an area that is surprising to see this quickly. Overall, the natural gas markets are bullish due to the seasonality, but beyond that it appears that there is a lot of concern about a potentially colder winter coming to the United States, which of course could be a huge driver for demand. Beyond that though, I think that the four dollars level above is going to offer a certain amount of psychological resistance, as the big figures tend to offer a lot of action.

NATGAS Video 13.11.18

I think the gap will get filled given enough time, and the fact that we are starting to form a bit of a shooting star may give the first hints that we are ready to roll over. If we break down below the bottom of the trading session for the Monday candle, then we will probably reach towards the $3.50 level to touch the top of the gap. If we break down below there, then we could unwind all the way down to the $3.25 level. However, I would not short this market just simply because there is a gap and we are overextended. We need some type of catalyst to kick off this selling. There has been talk about a potential El Niño pattern forming, that could be the thing that turns the market around. In the meantime, I would be cautious but looking for an opportunity to fade this overbought rally.

Don't miss a thing!

Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All

Top Promotions

Top Brokers

The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.