Natural Gas Price Forecast – Natural Gas Markets Continue to Consolidate Into the New Year

Natural gas markets have rallied a bit during the course of the trading session on Wednesday to reach above the $4.00 level. That being said, would not get overly excited, it is just simply that the market has nowhere to be between now and New Year’s Day. If anything, I am looking for signs of exhaustion that I can start selling, because the temperatures in the United States are still far too warm to sustain high pricing, so I think at this point in time it is only a matter of time before you see exhaustion that you can take advantage of.

NATGAS Video 30.12.21

The 200 day EMA sits just above, so that of course makes a certain amount of sense as a barrier, just as the $3.60 level underneath seems to be rather supportive. Longer-term, when I look at the previous descending triangle that we broke out of, the “measured move” reaches down to the $3.00 level, which happens to be an area that the natural gas markets have been very comfortable at multiple times over the last several years.

Quite frankly, all of the reasons for natural gas to rise have come and gone and I am somewhat surprised that there have been so many retail traders sucked into this contract assuming that is going to act like Europe. This is for the United States only, and therefore you need to keep in mind that it is weather in America and the supply in America that matters. The lack of supply due to the floods and the hurricane earlier this year are now distant memories.

For a look at all of today’s economic events, check out our economic calendar.