Advertisement
Advertisement

Natural Gas Price Forecast: Key Support Levels in Focus

By:
Bruce Powers

Natural gas hits new trend low, falling below potential support at 1.80, with eyes on further downside implications to 1.61.

Natural gas tanks, FX Empire

In this article:

Natural Gas Forecast Video for 13.02.24 by Bruce Powers

Natural gas falls to a new trend low of 1.76 on Monday at the time of this writing, and it remains near a potential support zone around 1.80, although below it. That puts natural gas 52% below the October swing high at 3.64 (A). The 1.80 price zone was a significant swing low in September 2020.

A graph with lines and numbers Description automatically generated with medium confidence

Daily Close Below 1.80 Points to a Deeper Decline

If natural gas closes decisively below 1.80, then that price zone is showing signs of failure, which would put natural gas on track to head to the next lower price zone of significance around 1.61. At the time of this writing, it continues to trade near the lows of the day. It was March 2016 when the 1.61 price zone saw a strong bullish reversal off a swing low. And it was recognized as monthly support a couple times after the 2016 low was complete.

A graph of stock market Description automatically generated

Weekly Bearish Continuation Signaled

Today’s decline triggered a weekly bearish trend continuation signal and natural gas is set to close weak, below last week’s low of 1.82. A weekly chart is also included today as reference along with a daily chart. Despite the lower 1.61 price level noted above, as the price of natural gas falls below 1.80 it heads into a prior consolidation range. Support could be seen anywhere within the range going down to the bottom of the range at 1.44. The 1.61 price zone includes a previous swing low and the completion of a falling ABCD pattern that is extended by the 127.2% Fibonacci ratio.

Below 1.60, Targets 1.52

Below the 1.60 price area is a zone from 1.52 to 1.49, consisting of a prior swing low from March 2020, along with an extended retracement of the rally begun in April 2023. The 1.44 low mentioned above was hit in June 2020 and it was quickly followed by a sharp rally. In other words, natural gas didn’t trade that low for long. It was the lowest price for natural gas since 1995. Therefore, it is not currently anticipated to be reached and the more likely scenario is a bullish reversal occurs at or above 1.49. Of course, future price action around potential support levels will be telling as to rising strength or weakness.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

Bruce boasts over 20 years in financial markets, holding senior roles such as Head of Trading Strategy at Relentless 13 Capital and Corporate Advisor at Chronos Futures. A CMT® charter holder and MBA in Finance, he's a renowned analyst and media figure, appearing on 150+ TV business shows.

Did you find this article useful?

Advertisement