Natural Gas Price Forecast – Natural Gas Markets Form SupportNatural gas fell during the early hours on Thursday but turned around to form a a hammer. This was very thin trading but it is a sign of positivity.
Natural gas markets fell a bit during the thin trading on Thursday but turned around to form a hammer. I think at this point the $2.60 level continues offer a bit of support, based upon recent price action. If we can break above the top of the candlestick from Thursday, that should see the natural gas markets go higher, perhaps reaching towards the $2.80 level. Remember, we are still trading cold temperatures as the market is focusing on the February contract. This typically is a high demand season, so therefore it is likely that we will see the markets rally a bit before we go looking towards the spring contracts which will have less demand. In other words, I believe this is a “one last hurrah trade” that we are getting ready to witness.
NATGAS Video 28.12.20
Somewhere near the $3.00 level I anticipate that we will see selling pressure, or at the very least a significant amount of exhaustion. There is a little bit of a gap just above there, so that should offer a significant amount of resistance as well. I think that we make a move towards that area then we start to think about the idea of shorting natural gas again as we have far too much of it in the world.
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That being said, to the downside we have the 200 day EMA sitting at roughly $2.46, which should be supportive all the way down to the $2.40 level. At this point in time, it is only a matter of time before buyers would get involved at that region as well, unless of course we see a sudden spike in temperatures in the United States and other northern countries.
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