Natural Gas Price Outlook – Natural Gas Continues to See Grind Higher

Natural Gas Technical Analysis

The natural gas market has rallied a bit during the trading session here on Wednesday in the early hours as we are now above the 50 day EMA. If you paid attention yesterday, I stated that we were hanging around the previous uptrend line, and it could cause a bit of selling pressure. But I also said if we break above the 50 day EMA, it’s possible that we could go looking at the $3.77 level. Any signs of exhaustion between here and there, I will be shorting because quite frankly, this is a market that I think will continue to favor the downside this time of year.

But there is a little bit of a different situation where the Europeans are importing natural gas from the United States and with the European Union importing that natural gas, it does leave the natural gas markets a little elevated this time of year. And of course, it has been a little bit hot this year as well, and the Northeastern part of the United States burns natural gas for electricity for air conditioning. So, it’s a little bit different in summertime than we’re used to seeing. But at the end of the day, even if that is taken out of the equation, we are still in a sideways market between $3 and $4.

So, the closer you get to the top, the more likely you are to see some exhaustion selling. If we were to break down from here, the 200-day EMA currently resides at the $3.38 level, which could be a support barrier. And then after that, you’d be looking at $3.20. Quite frankly, the natural gas market looks a lot like a significant number of commodities out there. It’s just not going anywhere, partly because I think people don’t really know where the economy is going right now with all of this tariff talk as well. Sideways, grindy action with a preference to the downside is how I see this market.

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