Natural Gas Price Forecast – Natural Gas Looking for SupportNatural gas fell again on Friday to close out the week, but it does look as if the gap that we have just filled is trying to offer a little bit of support.
Natural gas markets have fallen a bit during the trading session on Friday to reach down towards the $2.70 level. Having said that, we also fill the gap from several weeks ago, and it suggests that we are going to be looking for some type of short-term bounce. That being said, the market is one that is going to continue to see a lot of selling above, due to the fact that we will see a lot less in the way of demand as temperatures warm in the United States and of course the supply coming back online from being frozen. At this point in time, we also start to focus on the idea that we are getting close to spring, which will have its own ramifications when it comes to potential demand.
NATGAS Video 01.03.21
I do think that rallies at this point will probably be sold into, and therefore I like the idea of fading any signs of exhaustion that show up as the market will certainly be looking at higher temperatures in the northern hemisphere as being bearish. Eventually, we will refill any of the stock that has been lost over the last couple of weeks, and therefore the oversupply becomes the main story yet again. To the downside I believe that the market is probably going to go looking towards the $2.25 level, and then possibly even the $2.00 level over the longer term. I have no interest in buying this market anytime soon, as natural gas is extraordinarily oversupplied and nowhere near seeing a longer-term cyclical turn.
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