Natural Gas Price Forecast – Natural gas markets pulled back ahead of Fed

Natural gas markets pulled back a bit during the trading session on Wednesday awaiting for the Federal Reserve decision. We have filled the gap though, and that of course is something that should be good.
Christopher Lewis
Natural gas daily chart, September 19, 2019

The natural gas markets pulled back a bit during the trading session on Wednesday as we waited for the Federal Reserve to make its decision. Quite frankly, it should have a long-term lasting effect on the natural gas markets but it certainly will have a short-term volatility based effect. Looking at the chart, we have recently broke above the top of a bullish flag and it does look like we could go as high as the $3.00 level going forward, not to mention the fact that the 50 day EMA is starting to tilt higher.

NATGAS Video 19.09.19

The 200 day EMA is right through the gap right now, but I have removed it from the chart for clarity. We are above that crucial technical level, so longer-term traders are starting to jump into the natural gas markets as well. This is a cyclical trade that we can take advantage of as we head into the cold months and are currently trading November for the front month. With that being the case, it makes sense that buying dips continues to work, a lease as long as we can stay above the 50 day EMA. If we can make a fresh high, that would also be a buying opportunity as it should continue to send this market higher.

I am bullish of natural gas for the short term, perhaps until the middle of January when cyclically speaking we are starting to trade Spring contracts, and prices start to fall rather precipitously. I do not expect this winter to be any different.

Please let us know what you think in the comments below

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