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Natural Gas Price Forecast – Natural Gas Markets Looking For Range

By:
Christopher Lewis
Published: Feb 21, 2020, 18:16 UTC

The natural gas markets fell during the trading session on Friday, meaning testing the potential range that the market is trying to find.

Natural Gas

Natural gas markets fell initially during the trading session on Friday but did bounce a bit to show signs of resiliency again. Cold temperatures in the United States of course are helping natural gas in short-term markets, but longer-term we still have a lot of structural issues that we need to deal with, not the least of which is a massive oversupply of the commodity. Furthermore, warmer temperatures are on their way so that will of course weigh upon the market in general as well. I think at this point it’s easier to simply fade rallies as they occur, as the market gave us an opportunity to do so early during the session on Friday. The market filled the gap, and then bounced.

NATGAS Video 24.02.20

I believe at this point the market is trying to form some type of range to trade from, with the $2.00 level above as resistance, with the $1.80 level underneath for support. At this point, the 50 day EMA is starting to come into the picture, as it is an area that Thursday had seen buyers pull back from. I think at this point in time it’s likely that the market will continue to be back and forth and therefore give some type of range before it’s all said and done. However, if we do get some type of rally above the 50 day EMA it could open up the door to the $2.20 level. At that level, I would expect a lot of selling pressure to reemerge. For longer-term trade, there’s no real chance of this market picking up until we get a lot of bankruptcies with the oversupply out there of drillers and suppliers.

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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