Natural Gas Price Forecast – Natural Gas Markets Continue to Consolidate

Natural Gas Price Forecast Video for 07.08.23

Natural Gas Technical Analysis

Natural gas markets have rallied slightly during the trading session on Friday, as we continue to see a lot of noisy behavior. All things being equal, this is a market that I think continues to see more of a position building scenario, as the markets are looking ahead toward the mess in the European Union. After all, the Europeans will be struggling to find enough natural gas this winter, and because of this you could very well see a scenario where the market will try to get ahead of that, with the $3.00 level could be a short-term barrier. If we can break above that short-term barrier, then it’s likely that the natural gas markets continue to go higher, perhaps reaching toward the 200-Day EMA. In fact, I do think that happens given enough time.

On a pullback, I think there are plenty of buyers, and I do believe that the 2.00 level continues to be a massive floor in the market, but quite frankly I just don’t see how we break down through there. In fact, when you look at the chart, you can see that we have been grinding slightly higher for some time, but I also recognize that natural gas is simply killing time this time of year, as it is seasonally weak. The outlook for a cooler than anticipated August in North America probably has a lot to do with why we are still stalling, but once we get through that, it’s very likely that the buyers will continue to pile in.

For what it is worth, the ETF UNG in the United States is getting piled into by institutions, and I’ve been watching the time and date sales that confirmed this suspicion. With that being the case, I like the idea of buying and holding, but obviously you cannot do this with the huge position. On dips, I continue to add to my position, but I also would point out that this is more or less an investment, and not some type of short-term high levered trade. You have to be patient, and if you have the ability to trade the ETF, or perhaps even the CFD market, then this might be one of the bigger winners for the year, as I could easily see natural gas going to $5 eventually.

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