Natural Gas Price Outlook – Natural Gas Continues to Search for a Range

Natural Gas Technical Analysis

The natural gas market has pulled back a bit, gapping lower on Friday, only to turn around and fill that gap, and now we have dropped again. The question at this point in time is whether or not we are going to continue to fall from here. If we do, we will likely continue to see a move to the 200-day EMA, possibly even the 50-day EMA on our way, ultimately, I think, to the $3 level. The $3 level, of course, is a major gap and a large, round, psychologically significant figure. I also believe it is likely to be the bottom of a range that we’re getting ready to carve out here.

Keep in mind that this time of year is typically very bullish for natural gas as we start to lean into the idea of cold temperatures. Therefore, I think buying dips will continue to be the most likely play here in a market that has been very cyclical over the years. If we can break above the $3.60 level, then it opens up the possibility of a move to the $4 level, an area that has been important more than once in the past.

Ultimately, I think we’ll see a lot of volatility, but that’s nothing new for natural gas. I’m looking for buyers and buying opportunities based on value here, especially as we’re rolling over into the December contract next Wednesday. Before you know it, we’ll be thinking about Christmas and energy use during that time of year, with colder temperatures being paramount.

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