Natural Gas Price Outlook – Natural Gas Continues to See Noisy Upward Pressure

Natural Gas Technical Analysis

The natural gas market has shown itself to be positive in the early hours on Friday, despite the fact that we have seen so much in the way of noise during the trading session on Thursday. The 50-day EMA, of course, is an area that a lot of people will be paying close attention to. And of course, we have the area just above marked on the chart that suggests there should be a certain amount of market memory there as well.

So, with all of that being said, I do think that we get squeezed in the short term, but we are seeing record outflows of liquefied natural gas from the United States into the European Union. So that’s part of what’s going on because quite frankly, normally by this time in the year, natural gas has fallen through the floor. Now that doesn’t necessarily mean that the market changes forever. I just think it changes the cycle a bit.

I am looking for shorting opportunities, but I don’t see them at the moment. And I think it’s very likely we could consolidate between the $3.50 level below and the $3.75 level above. If we do break higher, the $4 level of course would be a barrier, and I still believe that the lack of demand for heating will eventually show up again. Looking at Fibonacci studies, we are hanging around the 38.2 % Fibonacci retracement level. So, there is a little bit there as well. I am somewhat bearish on natural gas, although I don’t necessarily think that we need to jump in with a huge position. We need to see exhaustion first before putting money into the market.

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