Natural Gas Price Outlook – Natural Gas Continues to Sit at the 50 Day EMA

Natural Gas Technical Analysis

The natural gas market did rally a little bit in the early hours, but we are just more or less hanging around the 50-day EMA. We’ve seen a nice run higher for a while now, but the question is, can we continue to see the upward momentum? The market breaking higher from here probably targets the 200 day EMA at the $3.26 level, but ultimately this is a market that, as long as we are still in relatively mild temperatures, it’s difficult to imagine a scenario where natural gas explodes to the upside.

Yes, the September contract will be a little better than the August contract, but until we get cold temperatures, the demand for natural gas won’t be very strong. Ultimately, I think a little bit of exhaustion probably has sellers jumping into the market, perhaps trying to fill the gap and going down to the $2.70 level. On the other hand, if we can break above the $3.26 level, that would be a change in trend for a lot of traders. And it could change things drastically.

While I do expect that eventually, I do not expect that anytime soon. With that being the case, I think you’ve got a situation where you’re looking for signs of exhaustion that you can take advantage of. And right now, we are starting to see a little bit of hesitation. So now we want to see momentum to the downside to start dropping from here.

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