Natural Gas Price Forecast – natural gas markets drift lower on Thursday

Natural gas markets drifted a bit lower during the trading session on Thursday, reaching down towards the $4.50 level. The market of course is highly volatile as of late, as we had seen a massive move higher. I believe at this point we are currently trying to try to figure out where were going next, but it looks as if the four dollars level underneath is massive support while the five dollars level above is massive resistance. I think we continue to go back and forth over the last couple of weeks of the year, and perhaps even into the early parts of the new year as colder temperatures continue to be a major driver of higher prices in the United States as well as the futures markets. That being said, it is also a market that is massively oversupplied in the longer-term, and I think that it is only a matter of time before the suppliers flood the market with more natural gas. Beyond that, we have the spring time coming relatively soon as we are already trading the January contract.

NATGAS Video 30.11.18

As soon as we get back to the springtime, the demand will drop and then of course supply will show up as well. With that being the case, we will undoubtedly see this market break down rather significantly. I do prefer selling rallies at this point, because we could not break above the five dollars level at this point. The most recent highs tend to drift a little bit lower, and therefore I think eventually we will break down below the four dollars handle, but it may take a couple of weeks.