Natural Gas Price Forecast – Natural gas markets bounced slightly on Friday

Natural gas markets have rallied just a bit during the trading session on Friday after the jobs number, as we have reached towards a major support level. That support level starts at the $2.60 level, reaching down towards the $2.50 level. That is a major support level on longer-term charts as well, so it would not surprise me at all to see a bit of a bounce from there. We haven’t quite reach down there yet though, so I think a short-term pullback probably occurs in order to at least test that $2.60 level. I would be more than willing to buy any signs of life down at that region.

NATGAS Video 08.04.19

To the upside, I recognize that the $2.90 level is massive resistance that extends to the psychologically important $3.00 region. We have been in this area for some time with the exception of the coldest winter months in North America, so at this point I think the range hold. If we were to break down below the $2.50 level, that would be catastrophic for natural gas. On the other hand, if we were to break above the $3.00 level, then it would show enough strength that we could go looking towards much higher levels. It’s not the right time of year for that to happen with any type of length though, so I still favor shorting rallies overall, but I recognize that we are so overextended and oversold to the downside that a short-term pop is very likely. Simply waiting for a buying opportunity or a rally that I can fade is how I play this market.

Please let us know what you think in the comments below