Natural Gas Price Forecast – Natural Gas Markets Give Up Early Gains

Natural gas markets have initially rallied again during the trading session on Thursday, but just like almost every other time we have done so, the sellers came in almost immediately and punished those willing to step in. It is a bit surprising me that people are still out there by natural gas just because of what is going on in Europe, but I get questions about all the time. This is a US centric contract and has absolutely nothing to do with what is going on in the European Union or Asia. At this point, the market looks as if it is simply killing time between support and resistance. The resistance of course is sitting at the 200 day EMA at $4.11 above.

NATGAS Video 31.12.21

The support level underneath is sitting just above $3.50, and therefore if we can break down below there it is likely that we will go looking towards the $3.00 level. The $3.00 level is the target based upon the descending triangle we broke out of and considered to be the “measured move.” As things being equal, this is a market that I think has much further to go to the downside target time it rallies I am looking for signs of exhaustion that I can start selling again. Temperatures are not following anytime soon, and even if they did, we are already trading the February contract so most of the peak season for natural gas has come and gone as far as US consumption is concerned. Ultimately, this is a market that gives us plenty of opportunities to short over the next several weeks.

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