Natural Gas Price Forecast – Natural Gas Markets Gap Higher to Kick Off the Week

Natural Gas Technical Analysis

Natural gas markets have gapped higher to kick off the trading week, pulled back to fill that gap, and then rose again. Ultimately, this is a market that continues to see a lot of noisy behavior, and quite frankly we had gotten so oversold that we needed this move. In fact, we may have a little bit further to go, but ultimately natural gas markets will continue to get hammered. This is because the United States is not going to be producing LNG for the European Union, and the EU has finally gotten it into its head that they need to find alternate sources of energy. (Take a look at the coal market to get an idea.)

If we can break down below the bottom of the candlestick for the Monday session, then I think we go lower to test the 200 Day EMA. This does not necessarily mean that you jump in with both feet, but I still think that this is going to be more or less a “fade the rallies” type of situation. Because of this, I think that the first signs of exhaustion in this market will continue to attract shorting opportunities. Because of this, I do think that we go much lower but we have fallen so hard in such a short amount of time a little bit of a bounce makes quite a bit of sense.

As things stand right now, the $5.34 is the “floor in the market”, and I would fully anticipate that we will eventually retest that area. If we can break down below there, then the market would fall apart but I think we’ve got some work to do before we make that attempt.

Natural Gas Price Forecast Video for 12.07.22

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