Natural Gas Price Forecast – Natural Gas Markets Testing the 200-Day EMA

Natural Gas Price Forecast Video for 09.10.23

Natural Gas Technical Analysis

Natural gas markets have rallied slightly during the day on Friday again, as we continue to confirm the breakout of the rounding bottom that I’ve been talking about ad nausea for 3 months now. Because of this, a certain amount of FOMO will enter the market, and people will be chasing this market now that it looks like it is ready to finally move. If you recall, I have an unlevered position in this market, meaning that it is more of an investment than it is a trade. I still look at it through that prism, and I recognize that anytime the market pulls back at this point, it’s probably going to end up being a buying opportunity.

The $3.00 level is an area that of course will attract a lot of attention as it is a large round, psychologically significant figure, an area of previous resistance, and the breakout point from the potential move higher. This is a cyclical trade because as we head into the winter, the demand for natural gas picks up. We are trading the November futures contract so that of course is something worth paying attention to.

Weather reports for the United States are for a cooler weekend, and that of course compounds the bullish behavior of the market as we not only have that, but we also have the lack of natural gas supply in the European Union, and the trans African natural gas pipeline possibly going off-line for the European Union. In other words, the Europeans have a very bleak winter ahead of themselves, much like they did last year. Last year they got lucky with a significantly milder winter than normal, so unless they get extraordinarily lucky this year, gas markets are going to spike quite widely.

At this point, anytime this market pulls back I look at it as an opportunity to get long and it does look like the 50-Day EMA underneath should continue to offer a certain amount of support. That is currently near the $2.85 level and rising, so all things being equal, this is a trait that I continue to hold onto.

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