Natural Gas Price Forecast – Natural Gas Markets Choppy

Natural gas markets have gone back and forth during the trading session on Wednesday as we continue to hang above the $3.00 level. To the upside, the $3.20 level has offered short-term resistance, and quite frankly when we look at this market, we have to do it through the prism of freezing temperatures in the central part of the United States that have shut down production. That being said, the market is likely to continue to see a lot of traders bet on the idea of dwindling supply, but at the end of the day we have far more than enough supply to fill the void given enough time.

As we start to head towards the springtime, there will be a lot of people who will be shorting due to the fact that there is a significant amount of warmer temperatures coming into the fray soon, and that should drive down demand. It is a cyclical trade that I take every year, and at this point I do not have the signal, but I am looking for a shorting opportunity in this general vicinity.

As soon as we get past the cold temperatures, this market will certainly plummet and I am more than willing to wait for a break down below the $3.00 level, or some type of shooting star on perhaps maybe a weekly chart. I have no interest in buying natural gas, because quite frankly the higher it goes, the more spectacular the selling pressure will be once we do get that breakdown. In general, I believe that we will probably go back towards the $2.30 level given enough time.