Natural Gas Price Outlook – Natural Gas Continues to Slump

Natural Gas Technical Analysis

Natural gas has fallen again in the early hours of Friday trading as we are now approaching the crucial 200 day EMA. This of course is an area that will attract a certain amount of attention from technical traders. And I do believe that we could get a slight bounce here, but that should end up being a selling opportunity. If we just bust through the 200 day EMA like it’s not even there, that wouldn’t necessarily surprise me either because quite frankly, we are in the midst of confirming a down leg in the natural gas markets.

This time of year, is typically very poor for natural gas. So, I would anticipate more downward pressure than up, as traders start to price in the fact that heating demand is falling off of a cliff. Quite frankly, the only thing that’s even supporting natural gas at this point is the fact that Europeans are buying it from Americans because you are trading an American contract.

So, it’s made this winter to spring transition a little different than usual, but it’s not enough to keep the market afloat. There is more than enough natural gas in the United States. And sometimes at the end of winter, you see a little bit of a spike as they purchase natural gas to fill up storage. Well, we’re beyond that now. And we find ourselves in the true weather driven process and that of course is going to be negative, at least for the next couple of months until we get some type of massive heat wave in the US. At this point I do think that we will make it back down to the $3 level.

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