Natural Gas Price Forecast – Natural Gas Continues Parabolic Move

Natural gas markets have shown themselves to be strong yet again on Tuesday, as we gapped higher, pulled back to fill that gap, and then shot straight through the air. We did up going well above the $6.00 level, but I would also point out that we gave back almost all of the gains rather quickly. This tells me that the market is forming a potential “blow off top”, which is actually a bearish sign. This does not necessarily mean that I would be a seller of this market, but if I was long of natural gas at this point, I might be a bit concerned in this general vicinity. We could see a rather significant pullback.

NATGAS Video 29.09.21

Because of this, it is very likely that we are going to see a lot of noisy behavior the next couple of days, with the $5.00 level underneath being a bit of a “floor in the market.” If that is going to be the case, I would anticipate a lot of reaction to that level, and then of course the $4.75 level next as it has been structurally important. I do believe that a pullback is not only likely, but it is probably necessary at this point. We have gotten so parabolic that sooner or later the markets have to fall apart.

This does not necessarily mean that you should be a seller of the market, just that you probably have an opportunity to pick up natural gas at a better price if you are patient enough to wait for that opportunity. Natural gas has been absolutely parabolic, but eventually gravity comes to all markets. This might be the beginning of that potential headwinds.

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