Natural Gas Price Forecast – natural gas markets rally to close out the week

Natural gas markets have broken down during the day on Friday only to turn around and rally again. I think what this shows is that although we will eventually break down from these extraordinarily high levels, natural gas markets are probably going to be consolidating. I do prefer to sell rallies that show signs of exhaustion rather than trying to buy this market as it has hit a very historically high attitude.

NATGAS Video 26.11.18

Keep in mind that eventually we start to trade Spring contracts, which of course will feature less demand. If that’s going to be the case, then fading the rallies will eventually work out to large gains. However, in the meantime you may wish to dial back some of your expectations as far as movements are concerned. I think that the four dollars level underneath is massive support, while the five dollars level above is massive resistance. I would not be surprised at all to see this market trade in this range for the next several weeks.

If we did break above the five dollars level, that would be an extraordinarily strong sign, just as a break down below the four dollars level would be an extraordinarily soft sign. Part of the bullishness in the natural gas markets is also being driven by the weakness in the crude oil market. If that turns around, then natural gas will also struggle due to that as well.