Natural Gas Price Forecast – Natural Gas Continues to Look For a Bottom

Natural Gas Price Forecast Video for 12-02-2024

Natural Gas Technical Analysis

Natural gas markets have initially plunged a little bit during the trading session on Friday only to turn around and show signs of life again. This is a market that is at extreme lows at the moment and therefore I think if you are a short term and very active trader, you might be tempted at this point to come in and take a quick smash and grab type of trade. That being said, if we turn around and break down below here, we are likely to go looking to the 1.80 level, which is an area that I think will cause a lot of support as well, given what it’s done in the past.

Ultimately, the $2.20 level above is going to be resistance as well and if we can break above there, then the $2.50 level comes into the picture. In general, I think a short term bounce makes quite a bit of sense because we are so oversold, but it is worth noting that the overall outlook for natural gas is not good as the winter has been a complete bust and therefore I think the demand will just be somewhat subtly range bound between now and next fall.

Ultimately, the oversupply of natural gas continues to make it a market that’s much easier to short than it is to go long, but we are overdone and I think a little bit of a profit taking bounce does make a little bit of sense. I don’t necessarily advocate doing so, but I do know some swing traders will be attracted. I certainly, if I got involved in this market, would not use a very big position. That being said, if you are more of a longer-term swing trader, you could start to build up a position but I would be very cautious about trying to get too aggressive at this point, because quite frankly most of what will be propelling the market to the upside is going to be short covering, not necessarily some type of massive fundamental change.

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