Natural Gas Price Forecast – Natural Gas Markets Continue To Hover

Natural gas markets have initially fallen during the trading session but then turned around to show signs of life again as the $1.80 level continues offer a little bit of support. At this point, the 50 day EMA just above is resistance, and it is at the $1.94 region. At this point, the market also will have a certain amount of psychological resistance in the form of the $2.00 level, so that is not something that we will likely see broken easily. However, it does look like natural gas is trying to find a bit of a footing here at the $1.80 level in general, so keep an eye on that level. If we break down below there, then we probably go back to the lows again. I suspect that one of the biggest drivers of the natural gas market right now is a simple unwinding of the “pairs trade” that traders had been involved in previously, buying crude oil in shorting natural gas.

NATGAS Video 17.03.20

Natural gas demand will start to drop though, because quite frankly the entire world is shutting down for a while at least, and at this point it’s difficult to imagine that demand will pick up not only due to the virus, but the simple fact that we are starting to head into the warmer part of the year, and that could continue to be a major problem as well, because quite frankly people will be using natural gas to heat their houses. Nonetheless, there are a lot of eyes on the credit markets, and whether or not we are going to get those inevitable bankruptcies anytime soon with shale producers.