Natural Gas Price Forecast – Natural Gas Markets Take Off Again

Natural gas markets have rallied rather significantly during the trading session on Thursday, breaking above the psychologically important $2.50 level. If you recall yesterday, I had suggested that we need to see some type of pullback in order to buy the market but regardless I was not going to be a seller. Years of experience has taught me that you do not sell in an uptrend, regardless of whether or not you will “know the market is going to pull back.” This is a perfect example of that because anybody who has shorted the natural gas markets because it had “gotten ahead of itself”, have gotten their faces ripped off during the session.

NATGAS Video 21.08.20

Unfortunately, if you are not already long in this market you cannot jump in here. Again, you need to see some type of pullback in order to offer value, and chasing the trade is probably the best way I know of that guarantees losses. The chasing of a trade is something that professionals do not do, and I know that these types of moves eventually have significant pullback. That something that you have to wait for at this point in time if you are not already involved.

For what it is worth, the 50 day EMA is getting ready to cross above the 200 day EMA, thereby causing the “golden cross”, a long-term technical signal that a lot of buyers like. We are starting to focus on the quarter months and of course we have extreme heat driving down supply in the United States while bankruptcies have been a major feature. This is a major short squeeze that probably has further to go.

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