Natural Gas Price Forecast – Natural Gas Attempts to Rally Slightly on Tuesday

Natural Gas Technical Analysis

You can see for the second day in a row, we’ve seen a little bit of a move higher. What’s interesting is that we have just filled the gap from the weekend. So, we’ll see whether or not that actually has the ability to lift the market or if it offers resistance.

Quite frankly, at this point, you have to wonder who’s out there willing to short this market but I’m sure somebody’s willing to chase this trade. We are getting very close to a historically supported area near $1.50 so that’s probably worth watching. We are oversold. This is the weekly chart that I’m looking at this point. The oversold condition, of course, is something that most people will be aware of, and you also have to wonder how long it will be before drillers in the United States just simply walk away. They’re not making money when gas plummets the way it has.

The $2 level above is going to be a significant resistance barrier, and if we can break above there, then the market is likely to go looking to the $2.50 level. However, that is a long-term move. More likely than not, what we will see is a lot of bouncing around in this general vicinity trying to form a longer term support level or basing pattern. This is a market that you probably want to see your signal come off of the weekly chart, which would give you a little bit of a heads up as to the longer term direction. As far as breaking down below the $1.50 level. It’s possible, but I don’t necessarily think it’s likely.

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