Natural Gas Price forecast for the week of January 29, 2018, Technical Analysis

Natural gas markets have rallied over the last week, as we continue to see colder temperatures in the United States, particularly in the northeastern corridor we get the most demand. However, we have a longer-term oversupply of natural gas, so it is more than likely only a matter of time before we start to see natural gas markets roll over again. Suppliers are more than happy to throw supply into the market when price rallies like this, and even though we have seen a significant move higher, the reality is that we start to think about spring pricing rather soon. Because of this, the slightest rise in temperature in the US could send this market much lower. Remember, even though we’ve seen a very explosive bullish move over the last couple of weeks, it moves in both directions rather quickly due to the lack of volume.

I believe that we are overextended by any measure, so even if we do go higher, we almost certainly need to pull back to build up enough momentum to continue going higher. I believe that the market will pull back sometime this week, but again, this is a market that is very difficult to trade from the longer-term perspective, unless of course you are looking for an excuse to start selling. The US dollar has been falling, so that of course has given a little bit of an artificial lift as of late, but in the end, I think that we will eventually see the longer-term fundamentals take over.

NATGAS Video 29.01.18