Natural Gas Price Outlook – Natural Gas Continues to Find a Range

Natural Gas Technical Analysis

The natural gas markets have been somewhat noisy over the last couple of trading weeks, but ultimately at this point in time I think you’ve got a situation where a lot of traders just really don’t know what to do because this time of year is very bearish for natural gas most of the time and that of course is something that is well known, as demand drops for heating in the United States, but it’s not hot enough to drive electricity through the roof trying to cool off houses.

However, the Europeans continue to have issues finding supply, or at least enough supply, and therefore they are buyers of US natural gas and that’s what you’re seeing play out here. The question at this point is, can we break to the upside or are we going to start rolling over again? I suspect you have a situation where traders will continue to look at the overall range between $3.12 cents on the bottom and $3.85 on the top. We are closer to the top and we are sitting right around the 50 day EMA. So that does have a certain amount of influence.

But ultimately, I think this is a market that stays in this range for the time being. I like the idea of fading rallies that show signs of exhaustion. The problem is we can’t get any traction in either direction. Really, there is no movement other than playing in this well-defined box. So, if that’s going to be the case, that’s the game we’re playing right now, and we must keep an eye on this range to make sure that it continues to hold. But as long as it does, you’ve got a back and forth market here.

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