Natural Gas Price Forecast – Natural Gas Markets Pull Back to Close Out The Week

Natural Gas Price Forecast Video for 08-01-2024

Natural Gas Technical Analysis

Natural gas did fall on Friday as we approached the 200 day EMA, a technical indicator that obviously causes a lot of noise. The area that we had tried to break above was just below the crucial $3 level, so I think that comes into the picture as well. Keep in mind that natural gas is reacting to a winter storm in the United States that is coming this weekend, and if the weather predictions shift a bit, that can completely change the way this market is behaving. This is the biggest problem retail traders face when trying to trade natural gas, they have to be meteorologists as well.

The massive amount of natural gas in the United States alone means that natural gas will always have an oversupply potential, and it certainly seems as if the run last year of higher pricing has brought quite a few more drillers into the space, and therefore they have flooded the market again.

Right now, this is a market that still has plenty of supply, so unless we are entering a new ice age, I just don’t see how we can hang on to gains. In fact, I think it’s probably only a matter of time before we pull back. You must keep in mind that the futures markets are focusing on the month of February already, and it’s likely that we might be looking at one of the last surges for the year.

There will probably be another one, and that will probably also end up being a short-term opportunity. Natural gas is so overabundant now that we are just struggling to continue going higher, and it’s easy to look at this as a winter that was a complete bust, despite the fact that the Europeans obviously have lost major natural gas sources. Even with the Nordstream II debacle and the issues pumping gas through West Africa, the reality is that the winter has been relatively warm, and as long as that’s going to be the case, natural gas is going to suffer. Quite frankly, it’s too late in the year to make a huge or massive difference.

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