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Natural Gas Price Forecast – Natural gas markets rally again on Wednesday

By:
Christopher Lewis
Updated: Jul 10, 2019, 15:49 UTC

Natural gas markets rallied again during the day on Wednesday, breaking above the 50 day EMA rather handily. This is a bullish sign but let us not forget that the marketplace is long-term negative, so we should keep an eye on a few things here.

Natural gas daily chart, July 11, 2019

Natural gas markets rallied a bit during the trading session on Wednesday, breaking above the 50 day EMA. At this point, the market looks very bullish for the short term but I also recognize that there is a lot of resistance above. Keep in mind that a lot of bullish pressure as of late has had to do with the fact that the weather forecasts for August is hot, and that could drive up demand for natural gas.

NATGAS Video 11.07.19

That being said, there is an oversupply of natural gas longer-term, so it’s very likely that we will eventually see that enter back into the marketplace psyche. I believe that the $2.60 level will be a significant resistance barrier, so some type of exhaustive candle would be a selling opportunity as eventually the fundamentals take over again. Quite frankly, this is the wrong time of year to expect higher natural gas prices the last any significant amount of time. Keep in mind that heat waves in the United States typically last a week or two, and then fade out. The cold weather in the winter lasts three months, thus the bullish season for natural gas.

I look at any rally that show signs of exhaustion as a selling opportunity and am especially interested in the region between $2.50 and $2.60 above. I have no interest in buying this market even though it’s only a matter of time before we see another pop. To the downside, it’s very likely that the $2.30 level will be revisited again.

Please let us know what you think in the comments below

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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