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Natural Gas Price Forecast – Natural Gas Markets Continues Same Consolidation

By:
Christopher Lewis
Published: May 10, 2021, 16:47 UTC

Natural gas markets fell significantly during the course of the trading session on Monday as traders came back to work.

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Natural gas markets have fallen rather hard during the course of the trading session on Monday as the $3.00 level continues to look very resistive. At this point, I think that the market will continue to see a lot of choppy behavior in this area, with the $2.90 level offering support. Keep in mind that the market is likely to continue to see a lot of choppy behavior but at the end of the day it is very likely that we will see the negativity creep back into this market.

NATGAS Video 11.05.21

After all, the market is at the top of the overall consolidation range, and we still have a gap underneath that has yet to be filled. Furthermore, the downside could stretch all the way down to the $2.40 level before breaking through the bottom of the consolidation. As temperatures finally warm up in the United States, that could drive down the value of natural gas, as it does every year. The cold temperatures have stayed much longer than usual, and that is part of the reason why natural gas markets have been elevated for a while.

Nonetheless, this is a market that I think will eventually see sellers due to the fact that the cyclical trade is well-known, and of course gaps do eventually get filled. With this, I think it is only a matter of time before the market does of course follow the same pattern it does every year. In fact, even if we did break to the upside, the resistance extends all the way to the three point to zero dollars level, so I just do not have a scenario in which a willing to buy a market that is so oversupplied.

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

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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