Natural Gas Price Forecast – Natural Gas Continues to Show Resistance

Natural gas markets initially tried to rally during the trading session on Monday after initially gapping higher. However, the market found the $3.00 level as resistive yet again and therefore showed a rather exhaustive looking candlestick again. This further suggests that we are going to see the $3.00 level above offer a lot of resistance, and therefore I am looking to start shorting this commodity. Yes, there is a massive cold snap in the northeastern part of the United States right now, but this only lasts for about a week, and the market is starting to focus on the month of March, considering that is the front month that we are trading. Because of this, I do believe that it is only a matter of time to start focusing on those warm temperatures.

NATGAS Video 09.02.21

As temperatures warming the northern hemisphere, the demand for natural gas is going to absolutely cratered. This is a seasonal trade that everybody in the market knows about, so a certain amount of “herd mentality” comes into play once we get to this area. Ultimately, I believe that this market goes looking towards the $2.50 level at the very least, as it is the 200 day EMA. Whether or not we can break down below there is completely different question but given enough time we should, if for no other reason than the seasonal trade that sits before us. I do not like buying natural gas under most conditions, and certainly not when we are starting to leave the realm of high demand season. With this in mind, I fade short-term rallies and will continue to do so for the next six months.

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