Natural Gas Price Forecast – natural gas markets gapped higher to start week

Natural gas markets gapped higher to kick off the week on Monday, reaching towards the $4.75 level before rolling over. I believe that the $5.00 level above continues to be a major resistance, and I think the market will struggle to break above there. We have gotten far too overextended, and even though natural gas inventories have been stripped fairly bare, it’s only a matter of time before suppliers overwhelm the market. Quite frankly, the market has gotten far ahead of itself, and even though we are trading futures contracts in the cold winter months, the natural gas situation in America is one of overabundance. Keep in mind that although natural gas markets are obviously global, the United States is by far the biggest driver.

NATGAS Video 20.11.18

If we did somehow break above the $5.00 level, then I think it’s time to step to the sides and simply wait for another blow off top. I believe it’s only a matter time before we reach back towards the $4.00 level, an area that obviously will attract a lot of attention. Quite frankly at this point I think we have seen the highs for the winter, and the market will go back to normalcy. If we get warmer temperatures this winter in the United States, then that will of course put a lot of bearish pressure on this market as well. If you are trying to buy natural gas at these elevated prices, you are simply chasing the trade.