Natural Gas Price Outlook – Natural Gas Continues to Look for a Floor

Natural Gas Technical Analysis

The natural gas market has initially fallen a little bit during the trading session on Friday, but it does look like we are finding a little bit of support near the $3.85 level. This is a market that has recently been all over the place and now is probably looking forward to the switch over from January to February on Monday, the 29th. So about six days, six trading days from now. In the meantime, it looks like we may actually attempt to try to fill the gap down to $3.60, which would be rather surprising, but it is what it is.

Waiting for Momentum to Match Value

At this point, I’m still looking for an opportunity to start buying in the form of upward momentum. We haven’t really gotten it yet. We got an attempt during the Thursday session, but it was beaten back by the inventory numbers. All things being equal, this is a market that I do think grinds its way higher again based on colder temperatures, but we are getting a little bit of a reprieve here in the United States, and that, of course, has everybody selling.

After all, the inventory numbers were a little better than anticipated, a little less of a drawdown, and warmer temperatures now will work against natural gas. Again, we’re one bad weather report away from this market taking off to the upside, so I’m still looking at the upside. I just recognize that we have found value. Now we need to find momentum, which is the other piece of the puzzle here.

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