Natural Gas Price Forecast – Testing Underneath of Trendline

Natural gas markets have initially rallied during the trading session on Tuesday to test the bottom of the uptrend line, and perhaps even more importantly, the 200 day EMA. That being the case, it looks as if the market is ready to test lower levels, and I do think that it is only a matter of time before we break down and go looking towards the $2.40 level, possibly even the $2.25 level. That of course makes quite a bit of sense considering that we are heading into warmer temperatures and demand for natural gas will continue to be very weak.

NATGAS Video 07.04.21

To the upside, the market is going to continue to see a lot of resistance, and at this point, I think that we are ready to continue to break down. The 50 day EMA above is a massive barrier, and I do not think we break above there anytime soon, barring some type of major shock to the market. Natural gas markets tend to move in a cycle, and as you can see, we have recently been selling off quite drastically and you could even make an argument for the idea of a bearish flag breaking down. The market of course is going to see some choppy behavior from time to time but given enough time I do think that we are probably going to go lower.

To the upside, if we were to somehow break above the 50 day EMA, the $2.75 level is massive resistance, followed by the $2.80 level which is even more resistive. In other words, there is just no reason whatsoever to buy this market in this timeframe.

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