Natural Gas Price Forecast – Natural Gas Markets Pull Back

Natural gas markets have fallen a bit during the trading session on Monday, breaking down about $0.20 during the day as we have seen a lot of volatility. Ultimately, the market looks very likely to see a lot of choppiness going forward, but quite frankly I do not think that you should be selling this market, because this is a market that is very bullish for a good reason, so there is no need to start shorting it.

NATGAS Video 03.11.20

Looking at this chart, the market has a massive gap underneath that needs to be filled, and I think somewhere near the $2.80 level will be a massive support level. You can also see a little bit of support at the $3.00 level as well, but I think it is much safer trade closer to the $2.80 level. Regardless, this is a market that should be bullish for a little while, because this is a market that sees a lot of demand this time a year. We are trading the January contract, and that of course means that we will see a certain amount of cold weather driven demand in the northern hemisphere.

Furthermore, we have also had multiple tropical storms and hurricanes through the Gulf of Mexico this year to interrupt production, so it makes sense that we should continue to drive higher. That being said, I am not a buyer of the market all the way appear, but I certainly would like to see some type of pullback in order to take advantage of value. Longer-term, I think we are going to go looking towards the $3.50 level, possibly even $4.00 above there.

For a look at all of today’s economic events, check out our economic calendar.