Natural Gas Price Outlook – Natural Gas Drifts Higher in Early Thursday Trading

Natural Gas Technical Analysis

The natural gas market has rallied a bit during the trading session here on Thursday in the early hours as we are trying to recover from the plunge on Wednesday. Quite frankly, this is a market that every time it rallies, I’ll be looking to short it because this time of year typically it’s not a very positive time of year for natural gas as it is very cyclical. There isn’t a huge demand for heating obviously in the Northern part of the planet, specifically the United States and Europe, but we do have a little bit different dynamic this year in the sense that the Europeans are finally not buying gas from the Russians.

So therefore, they are importing it from the United States. Chinese demand is a completely different question. It’s a little bit of a murky picture at the moment. So, I think you probably see more of a fade the rally on the first signs of exhaustion type of situation. I do believe that, ultimately, natural gas will try to get down to the $3 level, but it won’t be a straight line. It will be a situation where we are just simply looking for better places to short this market from. I believe that the 200 day EMA sitting at the $3.38 level is your first barrier. After that, you have the previous trend line and then the 50 day EMA right around the $3.55 level. I have no interest whatsoever in buying natural gas.

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