Natural Gas Price Forecast – natural gas gaps lower

Natural gas markets gapped lower to kick off the week on Monday, reaching down towards the $2.85 level. I think there is a major support at $2.75 as well, so I think that the downside is probably somewhat limited in the short term. I think at this point, if we show signs of a rally, it should be a nice selling opportunity, as there is plenty of resistance above at the various levels including $3.00 level, the 20 day EMA, and of course the 50 day EMA.

NATGAS Video 29.01.19

At this point, I think a rally will more than likely produce some type of exhaustive candle that we can start selling, as I think that breaking below the $2.75 level will take plenty of momentum to break down through. I think volatility will continue to be a major issue, as the oversupply of natural gas is going to be a longer-term bearish pressure on this market. At this point, I have no interest in buying natural gas, and I think that if you simply wait for signs of exhaustion after a pop, you should be rewarded. If we were to break down below the $2.75 level, that would be extraordinarily negative, but I think that might be a bit of a stretch at this point. However, if we were to break down below that important level, then I think we go looking towards the $2.50 level after that, which should attract a lot of attention as well. Patience will be rewarded.