Natural Gas Price Forecast: Targets Clustered Resistance Zone After AVWAP Recovery

Buyers Eye Sustained Recovery Above Long-Term AVWAP

Natural gas is positioned to potentially confirm a recovery above a long-term dynamic resistance level. Last Thursday, the anchored volume-weighted average price (AVWAP) was reclaimed and confirmed with two consecutive daily closes above $2.96. In early August, prices broke below this same AVWAP after multiple tests of support, triggering a bearish breakdown. However, prior interactions with this level in April this year and October 2024 saw bullish reversals from swing lows. A sustained recovery now could set the stage for strengthening momentum and reinforce the developing bullish case.

Holding Key Support After Holiday Session

Despite Monday’s shortened futures session due to the U.S. holiday, natural gas managed to push to a new bounce high of $3.07. Critical support now rests at $2.93 and $2.92, the lows from Monday and Friday. These levels align with the center line of a large descending channel, which has shifted from resistance into potential support.

Holding this area would suggest buyers remain in charge and could drive an upside continuation. However, a brief pullback before further gains remains likely as well. The 20-Day moving average, reclaimed last week and currently near $2.89, adds another layer of support.

Bullish Weekly Patterns Confirm

Last week, natural gas broke out of a falling bullish wedge and completed the week with a bullish engulfing candlestick pattern. This is a strong bullish signal, even though immediate upside follow-through is not guaranteed. The pattern’s validity remains intact as long as recent lows hold. Notably, last week’s bounce came directly from the 75% line of the falling channel, reinforcing the relevance of the broader structure and its connection to the 50% midpoint noted above.

Confluence of Resistance Targets

Both the daily and weekly charts are showing bullish technical behavior. The next upside target zone aligns with multiple resistance levels, suggesting a potential inflection point around $3.12–$3.19. This area includes a long-term uptrend line near $3.12, measured wedge breakout targets at $3.15 and $3.19, and the 50-Day moving average at $3.16. A move through this zone would strengthen the case for a more extended advance.

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