Natural Gas Price Forecast – Natural Gas Markets Pull Back

Natural gas markets have pulled back again during the trading session on Wednesday, as we await the inventory figures. That being said, the market is likely to test this overall support area, as it is so “thick.”
Christopher Lewis
Natural Gas Price Forecast - Natural Gas Markets Pull Back

Natural gas markets have fallen a bit during the trading session on Wednesday, reaching into that thicket zone of support that extends from the $2.20 level to the $2.00 level. That being said, the market is likely to see a lot of back and forth, but I do think that it is only a matter of time before we get a bit of a bounce. Temperatures have not been cooperating with natural gas markets during the winter, and we are already halfway through January. The fact that the Americans had drilled 17% more during 2019 than 2018 also adds more in the way of headwinds for market pricing.

NATGAS Video 16.01.20

Looking at this chart, I believe that we are going to continue to bang around in this $0.20 area, but if we can break above the shooting star from the previous session, the market probably goes looking towards the 50 day EMA, perhaps even the $2.40 level. All things being equal, natural gas markets are a disaster and we are even starting to see some companies out there worry about bankruptcy. I think that will be the story and 2020, there will be a significant amount of bankruptcies when it comes to companies in this sector, but given enough time it’s likely that the market will eventually see a spike this winter, but that is something that you should be selling into, on signs of exhaustion. If the market were to break down below the $2.00 level, it would be an absolute disaster for the commodity at that point.

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