Natural Gas Price Outlook – Natural Gas Drops Again on Early Monday

Natural Gas Technical Analysis

The natural gas markets have shown themselves to be a little bit negative in the early part of the trading session here on Monday. And at this point in time, we are testing the bottom of the range that we have been in for a while. So, it does make a certain amount of sense that we might see a little bit of hesitation here. But if we do break down below the bottom of the range, then I think we could go looking at this massive trend line that goes all the way back to February of 2024. In case there is a rally at this point in time, we’ll have to deal with the psychologically important $3 level, which of course will attract a certain amount of attention.

If we can break above there, then we could go looking at the 50 day EMA and then possibly the $3.20 level. All things being equal, this is a market that I think continues to see a lot of volatility and choppiness. But right now, we’ve got a situation where we are trying to turn things around for winter, but I don’t think we’re there yet. After all, temperatures are still fairly mild. They’re not hot nor are they cold. So, demand isn’t cranking up. But we also have to keep in mind that on Friday we switch over to the November contract and then we start to talk about a contract that probably picks up demand.

So, in the next couple of weeks, I do expect natural gas to turn things around, but we may have to fill this little bit of a gap between now and then, which could put this market closer to the $2.70 level before a bounce, which coincidentally just happens to be right about where the trend line is.

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