Natural Gas Price Forecast – Natural Gas Markets Continue Sideways Grinding

Natural gas markets have initially fallen during the trading session on Tuesday but turned around to show signs of life again as we are at the top of the range. All things been equal, this is a market that will continue to see a lot of volatility, especially as we are heading towards the end of the year and lack of liquidity. That being said, temperatures in the United States are rising so it does suggest that perhaps demand will continue to drop. Quite frankly, we would need to see a pretty significant move in temperatures to make this market react to cold.

NATGAS Video 22.12.21

Keep in mind that the natural gas situation in the United States is quite different than the problems in Europe, so I would not expect to see a massive spike anytime soon. In fact, any time this market spikes, I will be looking to short it. Based upon the triangle above, the measured move suggests that we could go down to the $3.00 level. The $3.00 level is an area of attraction multiple times, so it certainly makes sense that it would be comfortable sitting there.

To the upside, the 50 day EMA sits at the $4.55 level, and is dropping. Because of this, I think it is probably only a matter of time before sellers would come in and jump all over this market. With this being the case, I think there will be plenty of opportunities to short natural gas over the next several weeks, but it should be noted that we are heading towards the holidays so therefore I would not get too overly aggressive with my position size.

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