Natural Gas Price Forecast – Natural gas markets continue to look soft

Natural gas markets initially tried to rally during the trading session on Monday but continues to show signs of extreme weakness. This makes sense, because we are trading the September contract, not a particularly strong one most of the time. This is because we are exiting the hottest time of year in North America, but at the same time aren’t seen plunging temperatures. This does of course have an effect on demand, and we should also keep in mind that the supply of natural gas is far too strong to produce a strikingly bullish market anytime soon. All that being said, this keeps the bias to the downside in natural gas, as there’s no reason to think that demand is suddenly going to shrink the supply issue.

NATGAS Video 30.07.19

As we have broken below the $2.15 level, it’s likely that we will go to the next major figure, which of course is now going to be the $2.00 level. That’s an area that should cause a lot of trouble, at least for the sellers. I would be stunned if we broke down through there right away, and without at least a serious attempt to keep the market afloat.

To the upside, I see a lot of resistance near the $2.20 level, and of course the $2.25 level. The 50 day EMA continues to drift lower and has been rather resilient as far as resistance is concerned. It is because of this that I think we still see sellers regardless of any short-term bounce in the meantime.

Please let us know what you think in the comments below