Natural Gas Price Forecast June 30, 2017, Technical Analysis

Natural gas markets went sideways during the day on Thursday, but slammed in both directions. We initially sold off to reach towards the 24-hour exponential moving average, but then bounced rather significantly towards the $3.10 level. We then turned around to fall drastically, and now it looks as if we are trying to rally again. I believe that the overall volatility should continue, as the natural gas markets are very illiquid at times. Recently, we seen the market pick up again because of warmer temperatures coming to the United States, but quite frankly that’s a short-term rally just waiting for a reason to sell off again. After all, the oversupply natural gas is well known, and I think that the sellers will continue to get involved.

Looking for exhaustion

I’m simply looking for exhaustion to go short yet again. We can reach down to the $3 level rather quickly. If we break down below there, the market should then go looking for the $2.92 level after that. I believe that buying is all but impossible, unless of course you can trade for a very short-term move. I don’t believe in fighting the longer-term trend, and certainly not the fundamentals. Given enough time, I fully anticipate seeing the natural gas markets go down to the $2.75 level in the $2.50 level after that. However, keep your position size small as we continue to see massive turnarounds in both directions in what can be a very difficult market to navigate. Longer-term though, I believe that the sellers will continue to run the show, as there is so much natural gas that we simply cannot store it all. Because of this, I remain negative with my bias, but also recognize that there are times to step away and simply wait.

NATGAS Video 30.6.17