Natural Gas Price Forecast October 2, 2017, Technical Analysis

Natural gas markets when sideways overall during the day on Friday, as we continue to hang about the three dollars level. This is a very important level, that extends to the $3.10 level, and therefore think it’s only a matter of time before the sellers return on rallies. If we break down below the lows of the day, I think we will go much lower, perhaps trying to fill the gap from a couple of sessions ago. That could have the market dropping down to roughly $3.92, which would be a nice move. Beyond that, I don’t see much worth being bothered with it comes to the natural gas markets.

Oversupply continues to be a major issue, and even with two major hurricanes hitting the mainland United States, natural gas markets have not been able to burn off supply. The oversupply will without a doubt continue to keep this market soft and make rallies look suspicious. Quite frankly, once we broke above the $3.10 level, thought we are ready to go much higher but we didn’t just rolled over massively. Fundamentally speaking, most fracking companies become profitable above the three dollars level, so I think there is going to continue to be a significant amount of supply above there, keeping market somewhat suppressed over the longer-term. If we were to somehow breakdown below the $2.95 level, the market probably goes on to the $2.85 level where we have seen even more support. A breakdown below there since this market to the $2.75 level. I don’t really have a scenario in which we continue to rally for the longer-term, I think the fundamentals are far too bearish for that. Having said that, the market is very thin in a can move rapidly, and in either direction.

NATGAS Video 02.10.17