Natural Gas Price Forecast – Natural Gas Markets Gap Higher

Natural gas markets have gapped higher to kick off the trading session on Monday but have pulled back after trying to reach towards the 50 day EMA. Quite frankly, natural gas markets are ahead of themselves although there is cold temperatures heading towards the northeastern part of the United States. This will be a short-term blip on the radar, and therefore it does make a certain amount of sense that we would see natural gas fall to fill the gap that we just created.

NATGAS Video 11.01.22

We are so late in the season at this point in time it would take nothing short of a miracle to make natural gas markets spike significantly, although this opening was probably a bit more than people would have anticipated. Nonetheless, I do like the idea of shorting natural gas at this point, although I would not jump “all in” right away. Filling the gap makes quite a bit of sense, but I think we probably still have to get back down to the $3.50 level sooner rather than later, as we will be testing major support and still have quite a ways to go before, we filled the “measured move” that was suggested by the triangle above.

Remember, that move was suggested to be down towards the $3.00 level, which happens to be an area that the market is very comfortable with over the longer term. Because of this, it all lines up quite nicely for me as we head out of the strength of winter and start looking at spring. We are already trading the February contract, so at this point in time one has to wonder how much more strength could be found?

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