Natural Gas Price Forecast -Natural Gas Gets Boost From Winter Storm

Natural gas markets have gapped higher to kick off the week on Monday, and then shot straight towards the $2.80 level. This is in reaction to a major storm coming to the northeastern part of the United States, so it should not be a huge surprise that markets shot higher. However, we are still looking at spring coming around the corner, and that has obvious ramifications for the outlook when it comes to natural gas. Quite frankly, I am waiting to sell this.

NATGAS Video 02.02.21

If you been following me here at FX Empire for a while, you know that I believe there is a massive resistance barrier between the $2.80 level and the $3.00 level. Now that we are in this zone, I am simply looking for signs of exhaustion that I can take advantage of. I do not like the idea of buying natural gas this time of year, and even if we broke above the $3.00 level, there is a gap just above there that should also offer pretty significant resistance as well. Because of this, I think what we are going to see is a little bit more of a shock to the upside and then selling yet again.

As temperatures rise over the next couple of months, that will cause demand for natural gas to plummet, which naturally will bring down prices. Remember, natural gas is highly sensitive to short-term weather fluctuations, but beyond that there is not much supporting at any given time as the overabundant supply of natural gas continues to be a major problem. The seasonal trade for natural gas is all but dead at this point.

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