Natural gas markets continue to be very noisy and at this point I think they will continue to be very short term focused. During the trading session on Thursday, we had seen a break above the $3.00 level, which of course is a bullish sign in and of itself. However, I also recognize that there is a lot of noise between the $3.00 and $3.10 above. It is because of this that I think I’ll though the market has been bullish for the short term, it might be a bit difficult and dangerous to start buying now. I think it is much easier to sell this market on signs of exhaustion as we continue to see sellers jump in just above.
I believe that the $3.10 level above is even more resistive than the $3.00 level was, so I feel it’s only a matter of time before the sellers get involved. Part of the move will have undoubtedly been because we are about to see a very hot weekend in the United States, and therefore we could see a short-term burst in demand for natural gas to cool homes. That should be good for the market short term, but longer-term it’s not a reason to start investing. I think that the natural gas markets still are going to be a longer-term sellers type of situation, but obviously we have these little bursts of momentum from time to time. Be small in your position sizing.