Natural Gas Price Forecast – Natural gas markets continue to grind lower

Natural gas markets have drifted a little bit lower during the trading session on Wednesday, reaching towards the $2.66 level as I write this article. That being said, there is a much more important area just below that starts at the $2.60 level that extends down to the $2.50 level, marking the bottom of the overall consolidation. This is just as we have massive resistance at the $2.90 level that extends to the $3.00 level.

NATGAS Video 04.04.19

Looking at the chart, the 50 day EMA, pictured in red, is most decidedly negative and of course we have a massive oversupply of natural gas in general. Because of this, I like the idea of selling natural gas on short-term rallies that show signs of exhaustion. Otherwise, I believe what we are going to see is the overall consolidation, so therefore I recognize that any signs of a bounce near the $2.60 level and above the $2.50 level could be a short-term buying opportunity. This is just as true as the resistance that is found at the $2.90 level should offer nice selling opportunity on signs of exhaustion.

Overall, this is a market that is stuck in a range which is quite typical of natural gas when we are not in the high demand season which is during winter in North America and Europe. As we are escaping those cold temperatures, the demand will continue to drift lower, but I also recognize that near the $2.50 level the market continues to find buyers as the producers start to lose money and therefore cut back on production.

Please let us know what you think in the comments below