Natural Gas Price Outlook – Natural Gas Continues to Rally

Natural Gas Technical Analysis

The natural gas markets have gapped higher to kick off the trading session on Tuesday, pulled back to fill that gap and then rallied again to show signs of life. Ultimately, this is a market that I think, given enough time, probably continues to climb and may even threaten the $3.60 level. The $3.60 level is an area that previously has been resistant. So, I think it does make a certain amount of sense that we get a little bit of a fight there.

The market breaking above that then opens up the possibility of a move to the $4 level. All things being considered, it is the time of year when temperatures start dropping and therefore people will be looking for short-term pullbacks as buying opportunities, as demand will certainly increase for natural gas to heat homes in the United States and Northern Europe. We do have a massive gap from the rollover that extends all the way down to the $3 level, but we’ll just have to see if that actually comes into play.

I do think that any sustained pullback at this point probably gets looked at with suspicion, as natural gas will almost certainly continue to be favorable for buyers to be involved in over the next couple of months. We are currently in the month of November for futures markets. And November does tend to see a pickup in natural gas consumption. So, everything is moving along as you would expect.

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