Natural gas markets gapped lower to open the session on Monday, and then fell through the $2.85 level. On the hourly chart though, we are starting to see a bit of a hammer just below that level, so we may try to bounce from here, but at this point I think that will only end up being a nice buying opportunity. Alternately, if we can break down below the hammer on the hourly chart, which is at roughly the $2.81, the market will probably continue to go much lower. At this point, the gap at the open of the session will more than likely be a resistance barrier above, that can give us a bit of a guideposts as to how high we can go.
Ultimately, I think that the market will probably go down to the $2.70 level underneath, which is the bottom of the larger consolidation area that we have been following for some time. I also believe that the global growth slowing down has people concerned about demand for natural gas and energy in general. Overall, I think that the market continues to offer a nice selling opportunity, and at this point I think that it’s only a matter of time that the sellers will continue to punish this market. I think that the market will struggle to get above the $2.92 level, but even if it does I think there’s even more resistance above at the $2.95 level going forward. I am a seller of natural gas and have no interest in buying this market.