Natural Gas Price Forecast – natural gas markets under pressure again

Natural gas markets continue to march lower, as technical resistance has gotten in the way of buyers. The 50 day EMA of course has offered resistance as you can see plainly on the chart, but also we have to worry about the fact that the futures market is starting to trade the March contract heavily, meaning that people are starting to speculate that prices are going to drop rather drastically. At this point, it should be obvious that rallies are to be sold, and that the uptrend is now a thing of the past.

NATGAS Video 20.12.18

I believe that the $4.00 level will be massive resistance, so if we do not break above there, that will be an excellent shorting opportunity. We had previously been in a major symmetric triangle, and now it looks as if we are ready to go much lower. I currently believe that we are going to go down to the $3.00 level and that every time we rally, you should be looking for an opportunity to start selling again. Natural gas does tend to go up and down with the temperatures in the United States, which have been surprisingly mild. That will of course drive down demand, and cheap crude oil also takes away some of the industrial demand of natural gas. In this environment, it’s likely that we will continue to see a lot of trouble as the supply of natural gas is so large, and quite frankly petroleum has become so cheap. If we have global slowdown fears, which we currently seem to, then we also have to pay attention to the fact that demand may drop from that angle as well. Fade the rallies.