Natural Gas Price Forecast – Natural Gas Markets Test Big Figure

Natural gas markets have drifted a bit lower during the trading session on Wednesday, reaching down towards the $3.00 level. This is of course a large, round, psychologically significant figure that will attract a certain amount of attention. Having said that, there is still a gap that goes down to the $2.80 level, and therefore I think it is likely that we will continue to see a bit of negativity, perhaps trying to fill that gap. Quite frankly, that is a trade that I am more than willing to wait on, because the potential payout would be rather strong. The question is not so much as to whether or not the buyers would be there, but when we get there.

NATGAS Video 05.11.20

Looking at the chart, I think that we will revisit the highs at $3.40 based upon the fact that we are trading cold months contracts, and of course demand will pick up. There are warmer temperatures coming to the northern part of the United States over the next week or so, but that of course is a short-term phenomenon that will cause nothing more than a bit of noise in the markets. With that in mind, I have no interest in shorting this market, at least not for the next couple of months as we clearly have more demand coming down the road, especially if they are does end up being a lot of stimulus in the United States, which has a side note looks less likely due to the fact that the Senate is likely to remain Republican.

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