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Christopher Lewis
Natural Gas

Natural gas markets initially pulled back during the trading session on Tuesday but found the $1.60 level supportive yet again. Ultimately, this is the same area that we have seen buyers come in, extending down to the $1.57 level. I think ultimately, we will see this market turn around and reach towards the upside, perhaps reaching towards the 50 day EMA. For reference, it is worth noting that the forward contract has rolled over into the month of August.

NATGAS Video 24.06.20

The $1.50 level has been crucial over the longer term, so it is not a huge surprise that it could possibly end up being a bit of a “floor.” At this point, the market is likely to see buyers coming in based upon “value”, and the fact that this has been important so many times in the past. I think it is likely to see this area as exceedingly difficult to break down through and the fact that we have formed this candlestick for the day tells me that there is plenty of interest in this market.

Having said that, I believe that the 50 day EMA above at the $1.80 level will be difficult to break above. If we break above the $1.80 level, then it is likely to go looking towards the $2.00 level above there. In fact, it still looks as if we are going to form a bit of a “double bottom”, or some type of “rounded bottom”, both of which show signs of support.

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

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