Natural Gas Price Forecast – Natural Gas Continues to Bounce Around

Natural Gas Technical Analysis

Natural gas marketes continue to see a lot of noisy behavior. All things being equal, this is a market that I think is bouncing along a major bottom. And I don’t think that will change anytime soon. We are heading into a seasonally weak time of year, and of course, we have massive amounts of supply.

Nonetheless, we do find ourselves at a massive floor in the market, mainly due to the fact that below about $1.50, you start to see drillers lose money drilling. That will work off some of the supply. The problem is how long will it take? Well, we don’t know. And that’s why I approach this as an investment and not necessarily something that I’m trying to trade quickly and with that being the case, I am hanging around via ETFs.

I don’t worry about the day-to-day noise. I recognize that we’re in an extreme low when you look at the longer term charts. And sooner or later, simple supply and demand comes back into the picture. It’s very possible this may be sideways between $1.50 and $2 between now and the end of summer. That’s fine.

What I recognize, though, is that it is a part of my portfolio that I think will perform quite well at one point or another this year. It could be a late winter storm. It could be a heat wave in the middle of the summer, or it could just simply be when fall returns. Because of this, I don’t use leverage, and I just wait for the market to return to some type of balance. Right now, you’re going to be hard pressed to make big bets.

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