Natural Gas Price Forecast October 24, 2017, Technical Analysis

The natural gas markets gapped higher at the open on Monday, showing signs of extreme bullishness. The $3 level above continues to offer resistance, and I think that resistance will continue to extend to the $3.10 level. Ultimately, this is a market that continues to show a lot of noise, and of course it seems as if it’s only a matter of time before we sell off if we do get above the $3 handle. I’ve been making this trade quite a bit over the last several months, and so far, it works every time. Given enough time, we should then go looking towards the $2.85 level, but clearly this market still has a lot of bullish pressure still build up in it, and that keeps it difficult to start shorting immediately. However, if you are patient enough you should be able to see and exhaustive candle that you can take advantage of.

If we managed to close above the $3.10 level on a daily candle, I think that we could see the buyers come back, but right now it seems very unlikely. This has been a massive gap at the open, but I think that it is yet another gap in what has been a series of large moves. The markets continue to be extraordinarily erratic, but that only offers more opportunity going forward. The small trading positions will probably be necessary, unless of course you can ride out a massive amount of volatility. I don’t suspect that’s going to be an easy thing to deal with though, so this will become a very personal decision depending on your risk tolerance. For myself, I have been content to take medium-size positions repeatedly to the downside. Even with winter coming in the United States, it seems very unlikely that the oversupply will be wiped out.

NATGAS Video 24.10.17