Natural Gas Price Forecast: Sellers Take Control as Gas Retreats From 200-Day Line

Natural Gas Reverses at Resistance

Sellers remained in control on Friday as natural gas triggered a bearish reversal by breaking below the low of Thursday’s shooting star candlestick. That pattern developed after a quick test of resistance near the 200-Day moving average, marking a key turning point. The rejection at the 200-Day line has now developed into sharper selling pressure, raising the likelihood of a pullback toward lower support zones.

Testing Support Levels Ahead

Natural gas is now approaching dynamic support at the 10-Day moving average at $3.14 and the 20-Day average at $3.08. Both levels will be closely watched for signs of buying interest. Failure to hold these averages could extend the decline toward the 50-Day average at $3.00, a more significant support area for the intermediate trend. Given the strength of the rejection at the 200-Day line, a test of deeper levels cannot be ruled out.

Bearish Signals Align with ABCD Pattern

Thursday’s high of $3.59 briefly breached the 200-Day average and touched the top of a descending channel, while also surpassing the 127.2% projection of a rising ABCD pattern at $3.49. However, the failure to secure a daily close above the 200-Day line underscored the market’s hesitation. The alignment of resistance at the channel boundary, the 200-Day average, and the ABCD projection reinforced the likelihood of a reversal at this level.

Potential Gap Test Below

A nearby unfilled gap between $2.97 and $3.12 adds another layer of potential downside targets. Market behavior around this gap could provide insight into demand strength during a pullback. Typically, the first approach back to the 200-Day line after it has flipped from support to resistance is met with rejection, and that dynamic appears to be playing out now.

Bigger Picture Trend

The completion of the extended ABCD pattern this week suggests that the recent rally may have only been corrective within a broader downtrend. With a lower swing high confirmed on the daily chart, the stronger force of the descending channel could reassert itself. For now, buyers must defend key moving averages to prevent deeper losses and avoid a renewed downtrend.

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