Natural gas markets continue to show signs of strength during the trading session on Tuesday, as we have cleared major resistance by gapping up on Monday. However, this is a market that is overdone so I don’t think you can buy up here. Quite frankly, I think if start buying at these levels, you’re going to end up losing money. Gaps do tend to get filled in the futures market, so you need to wait for an opportunity to pick up natural gas markets at lower levels. On the December contract I think the $3.40 level should now be supportive as it was previous resistance. However, we are starting to roll over a bit into the January contract which is essentially $0.10 higher.
NATGAS Video 07.11.18
Ultimately, this is a market that I think looking for value is probably the best thing that we can anticipate, so therefore you just simply going to have to be cautious going long. I think that the lower we go, Elise down to the $3.25 level, it’s a nice buying opportunity. Ultimately, I don’t have any interest in shorting this market, at least not until we get closer to the spring time as the seasonality is certainly working in favor of the commodity, and of course recently we have heard weather reports that suggests the wintertime in the United States may be a bit colder than originally thought, which of course will drive up demand for natural gas as far as heating is concerned. The buy on the dips remains the strategy in the meantime.