Natural Gas Price Outlook – Natural Gas Continues to Pressure Upside

Natural Gas Technical Analysis

The natural gas market has shown itself to be a bit positive, but at this point in time, we are reaching an area that I would anticipate seeing a bit of trouble. Keep in mind that LNG exports out of the United States are reaching record highs going to other parts of the world. So that’s part of what we’re seeing here, because while the seasonality of natural gas does tend to favor the downside, and that’s still the way I look at this going forward. The reality is the market is a little bit of skewed behavior at the moment. I still like the idea of a sign of exhaustion being a shorting opportunity. And if we can take out the lows of the Tuesday session, then I think is when we start to see selling pressure pretty significantly.

Ultimately, this is a market that I think given enough time, we will find sellers jumping in. Now, that being said, if we do turn around and break above the $3.80 level, then you have to assume that natural gas will try to go to $4. This is a bit of a noisy market, but it wouldn’t surprise me to see this massive shot higher, this massive pullback, a big shot higher, and then an even bigger drop. The natural gas market is really good at causing chaos to trading accounts. In fact, we’re right here at the 38.2 % Fibonacci retracement level from the high, so it’ll be interesting to see how that plays out.

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