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Christopher Lewis
Natural gas daily chart, September 12, 2019

Natural gas markets pulled back a bit during the trading session on Wednesday, reaching towards the $2.50 level before bouncing a bit. We are currently hovering around the 200 day EMA, so this point I think it’s very likely we continue to see a lot of choppiness in this area. When you get a shooting star that is then followed by a hammer, that typically means that you are going to see a lot of choppiness and volatility in a tight range. I think at this point, we are very likely the sea one of two things: either a break down below the $2.50 level, and perhaps reach down to the 50 day EMA, or perhaps the market may simply sit in this area and wait for the momentum to pick back up. At this point, I think the 50 day EMA will more than likely caused by pressure as well.

NATGAS Video 11.09.19

I would prefer to buy on a pullback, but at this point I do recognize that perhaps the market will simply grind and digest the gains which is quite often how a trend starts to take off again. Quite frankly, the market needs to be comfortable with this general vicinity to continue going higher. We are getting close to that “Winter pop”, and therefore we should see a massive move lower but right now I would be a bit hesitant to simply start buying on a break above the top of the shooting star, although it is technically a buy signal. Pullbacks offer value.

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