FXEMPIRE
All
Ad
Corona Virus
Stay Safe, FollowGuidance
World
20,820,389Confirmed
747,476Deaths
13,719,719Recovered
Fetching Location Data…
Advertisement
Advertisement
Christopher Lewis

The natural gas markets continue to show signs of resistance to any move higher as the market shows a large amount of oversupply is still a major problem. The market continues to see a lot of negativity every time it tries to rally, and therefore it’s likely that we could go much lower. The $1.60 level underneath is a major level of support from a longer-term standpoint, so that might be where we are heading.

NATGAS Video 28.02.20

The inventory figure during the trading session on Thursday was very disappointing, as it was -143 billion instead of the expected -158 billion. In other words, we are not burning through the supply quick enough and then to add more fear is the fact that the coronavirus may slow down a lot of industrial use for natural gas, just as temperatures will be warming up in the northern hemisphere. In other words, there is nothing to think that this market is going to be able to rally for a significant amount of time, with perhaps the exception of the occasional spike higher due to the inevitable cold snaps that we get at the end of the wintertime. That’s a short-term opportunity for buyers, but quite frankly sets up a nice selling opportunity for those who are a little smarter about it.

Eventually, we will have the bankruptcies necessary to bring down the supply, but we aren’t there yet. Low natural gas prices continue to decimate the profits of any of the companies that are involved in this market, and things continue to look extraordinarily bleak. Selling rallies continues to be how I trade this market.

Advertisement
Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All

Trade With A Regulated Broker

  • Your capital is at risk