Natural Gas Price Forecast – Natural Gas Markets Continue Higher

The natural gas markets have formed a massive move higher during the trading session on Thursday, as the hurricane has hit the Gulf of Mexico. This of course has natural gas production cut quite drastically, so it makes sense that price would rally. The question now is whether or not we are going to see any type of longer-term demand pick up. I do think that comes, simply because there are a lot of companies out there that have entered bankruptcy, and of course this market has been beaten down for so long. Furthermore, we are starting to trade months that could be a bit colder, so that should drive up demand as well.

NATGAS Video 28.08.20

We have had an extraordinarily hot summer in the western per the United States and that has increased demand as well. Furthermore, the US dollar has been getting hit hard, so that means that it will take more of those greenbacks to buy natural gas, putting upward pressure on all commodities, not just this one. Ultimately, I do believe that we go higher and probably go looking towards the $3.00 level, but I need to see some type of pullback in order to get a bit of value.

Chasing this trade is a very dangerous thing to do as we have gone completely parabolic. That being said, even if I knew that this market was going to fall tomorrow, I would not be bothered shorting it. I like the idea of buying closer to the $2.50 level, $2.40 level, and love the idea of buying it $2.20 below. However, this is probably one of those deals where you are going to have to take whatever is offered.

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