Natural Gas Price Forecast – Natural Gas Markets Show Resiliency

Natural gas markets continue to show interest at the $2.40 level as we formed a “triple hammer” over the last several days. In fact, the hammer from Friday was even more impressive than the other two so I do not think that selling makes much sense here. In fact, I believe that we are likely to see a bit of a bounce from here, as the 50 day EMA seems to be attracting a lot of attention. Perhaps even more interesting and important than that is the fact that the gap has now basically been filled, and looks to be holding, which is something that is much more important.

NATGAS Video 05.10.20

If we break above the $2.60 level, I think that it is pretty smooth sailing to the $2.80 level above, but you cannot necessarily count on that as this market tends to be very volatile. All things being equal I do like the idea of buying natural gas instead of selling it as we head into the winter months for the northern hemisphere, the biggest consumers of natural gas. Temperatures are dropping in the United States, so it is only a matter of time before we start to burn through some of the supply.

That being said, there are some concerns out there as far as industrial demand, as the jobs number was less than impressive on Friday. I look at this chart with a bit of bullishness, as I think we will continue to try to reach towards the $3.00 level, and it is obvious that the buyers have been in control for at least the last couple of months.

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