Advertisement
Advertisement

Natural Gas Price Forecast – Natural Gas Markets Showing Signs of Resistance

By:
Christopher Lewis
Updated: Aug 26, 2020, 16:22 UTC

The natural gas markets have tried to rally during the early hours, but the markets have turned around to form a bit of a shooting star.

Natural Gas

Natural gas markets continue to show resistance right around the $2.60 level, and therefore it should not be surprising that we are forming a bit of a shooting star during the trading session. That being said, the market is a bit overextended so it is likely that we will see some type of pullback. To the downside, the $2.40 level should be an area that attracts a certain amount of attention, as there is a gap there and of course it should be somewhat supportive. If we were to break down below there, the market is likely to go looking towards the $2.20 level, but it is going to take a significant pullback in order to make that happen.

NATGAS Video 27.08.20

The multiple storms heading into the Gulf of Mexico could continue to cause problems, as natural gas production is essentially shut down for the most part. That being said, it is only a matter of time before the production pics back out, and that could drive this market back down but longer-term we have made a huge move and I think it has wiped out a lot of shorts. Furthermore, the market should continue to see an upward pressure due to the fact that we are heading into the colder months of the year. Furthermore, there has been a massive amount of heat in the American West, and therefore a lot of natural gas will have been used to cool off homes. All things being equal, I am looking to buy a dip, but I do not have it quite yet.

For a look at all of today’s economic events, check out our economic calendar.

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.

Did you find this article useful?

Advertisement