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Natural Gas Price Forecast – Natural Gas Ride Wave of Commodity Strength

By:
Christopher Lewis
Published: May 17, 2021, 15:50 UTC

Natural gas markets have rallied quite significantly during the trading session on Monday to reach towards the $3.15 level. As commodities in general have rallied, natural gas has been a beneficiary by proxy.

Natural Gas Price Forecast – Natural Gas Ride Wave of Commodity Strength

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Natural gas markets have rallied significantly during the Monday session as we continue to see commodities in general take momentum to new extremes. That being said, the natural gas markets are oversupplied so I think it is only a matter of time before we would see selling pressure, so at this point until the commodity momentum wears down, natural gas might have the ability to levitate. It certainly has nothing to do with supply and demand, and it is probably more or less going to be a “knock on effect” when it comes to this chart.

NATGAS Video 18.05.21

The $3.20 level has been an area that has mattered for a while, and therefore I think it is going to be interesting to see what happens here. Ultimately, I think that the market is more than likely going to sell off, but you cannot short it at this point, because quite frankly the commodity markets are all moving in lockstep, despite the fact that not all will be needed as the same as others. Given enough time, this is going to present a great shorting opportunity to reach down towards the gap underneath, but we see no signs of that right now, but you certainly cannot buy it all the way appear as it is approaching resistance.

Quite frankly, if you are looking to take advantage of the energy trade, you should be buying crude oil and not natural gas. With this being the case, a bit of caution is probably advised, but a bit of patience could set up for a nice longer-term trade eventually.

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

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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