Natural Gas Price Forecast – Natural Gas Continues to Bounce Around The Bottom

Natural Gas Technical Analysis

We have pulled back again during the day here on Friday, but if you watched the video yesterday, you know that I had suggested that perhaps natural gas would be a situation where it was more of an investment and less of a trade. And therefore, you need to keep low leverage. Low leverage is the key here. And with that being the case, I am in an ETF, so these moves don’t really bother me. This is why though, this is exactly why you can’t be trading in the futures market right now, because it is so highly levered, and of course you can get your head handed to you rather quickly. So, with that being said, I still look at the $1.50 level as major support, and it certainly has been over the last several years. Sooner or later, drillers walk away.

If you’re not making money, you’re not drilling, and that’s essentially the situation they find themselves in if this keeps up. So I do think this is a longer term macro play, which means you have to be able to hang on to it. You have to be able to see 30 cent swings. And the only way to do that is either through buying options, buying CFD positions that are small and then adding as it works, or an ETF like I have, and I just let it do its thing. And I might get paid in the summer, and heat wave, I might get paid in November or who knows when temperatures drop again in the northern hemisphere, but it is a set-and-forget market.

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