Natural Gas Price Futures (NG) Technical Analysis – Trading on Weak Side of Main Retracement Zone at $3.775 to $3.980

With the bears clearly in control at the moment, February natural gas futures gapped lower on the opening on Monday. Although the market may be oversold by some technical measures, we’re likely to continue to see more downside pressure throughout the session amid forecasts calling for warmer temperatures over the near-to-mid-term.

At 0305 GMT, February natural gas is trading $3.598, down $0.155 or -4.13%.

Daily Swing Chart Technical Analysis

The trend is up according to the main swing chart. However, momentum is trending lower. The daily chart is wide open to the downside with the next main bottom coming in at $3.111. A trade through this level will change the main trend to down. A move through $4.849 will signal a resumption of the uptrend.

The trend is down according to the minor swing chart. This is why the momentum is trending lower. The minor trend will change to up on a trade through $4.533. This will also shift momentum to the upside.

The main range is $3.111 to $4.849. The market is currently trading on the weak side of its retracement zone at $3.775 to $3.980, helping to give the market a short-term downside target.

Daily Swing Chart Technical Forecast

A sustained move under the Fibonacci level at $3.775 should continue to keep the downside pressure on the market. If downside momentum continues to build then sellers could drive the February natural gas futures contract into the November 2, 2018 main bottom at $3.111.

On the upside, filling in the gap with a test of $3.718 will be the first sign of buyers. Overtaking this level will indicate the buying is getting stronger. This could trigger a further rally into the Fibonacci level at $3.775.

The market could consolidate between $3.775 and $3.980 until traders can digest the new weather forecasts.