Natural Gas Price Forecast – Natural Gas Markets Take OffNatural gas rallied significantly on Friday, breaking to fresh highs yet again. Closing towards the top of the range suggests that we are ready to go higher.
I have been waiting for a nice pullback in natural gas, and although we did get a slight one, we unfortunately did not get a strong one. At this point in time, it is likely that the market will continue to go higher, reaching towards the $2.40 level. That is a large, round, psychologically significant figure, and therefore I think it will continue to go higher over the longer term, as it now looks like the $2.00 level offers a “floor” in the market, and then of course the $2.10 level is also supportive.
NATGAS Video 17.08.20
To the downside, if we did break down below the $2.00 level it would be a surrendering of the 200 day EMA, which of course would be rather negative. However, with all of the bankruptcies out there in this marketplace, and of course the fact that the US dollar has been falling, there has been a bit of natural pressure to the upside. Furthermore, we also have to keep in mind that we are now trading the colder months, as the front month is September and before you know it will be trading even colder months.
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I like buying dips, and that will continue to be the case going forward. I think that the $2.50 level will probably be a target midterm, but it is going to take some time to get there more than likely. After all, this is a lot like the EUR/USD currency pair, it is in the midst of a major trend change in these things tend to be very noisy to say the least.
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