Natural Gas Price Forecast – Natural Gas Markets Sideways

Natural gas markets have gone back and forth during the course of the trading session on Thursday to show signs of hesitation yet again. That being said, the 50 day EMA sits at the $2.76 level, and it could offer a bit of a barrier to the upside, which makes quite a bit of sense considering that the spring is coming in the few weeks, that of course will drive down demand overall for heating. Yes, I understand that there is the “reopening trade” that everybody is harping on about, but at the end of the day natural gas is an oversupplied industry.

NATGAS Video 12.03.21

The 200 day EMA sitting underneath at the $2.57 level offers significant support, but if we can break down below there then I think that the market drops down to the $2.40 level. The $2.40 level has been supportive more than once, but I think that we not only break down below that level but go looking towards the $2.00 level which is obviously a large, round, psychologically significant figure.

To the upside, the market is likely to see resistance above at the $2.80 level, and then of course the $3.00 level. I do not think that we can break above the $3.00 level, but even if we did, I still would not be a buyer because quite frankly the cyclical nature of the market suggests that you should only be selling. At this point, all I want to see is some type of exhaustive candlestick that I can start selling again, or course would get short below the 200 day EMA as well.

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