Natural Gas Price Outlook – Natural Gas Gives Back Initial Momentum

Natural Gas Technical Analysis

Natural gas has overshot the previous uptrend line, but now on Monday, it looks like it’s going to give back some of those gains. This is a cyclically poor time of year for natural gas. So, I’m looking for reasons to get short. I don’t really have much yet. Although you can make an argument that right here at the 38.2 % Fibonacci retracement level, we are starting to see signs of exhaustion. And if we break back below this previous uptrend line, that could have people jumping in and shorting to the FOMO type of situation. Natural gas, of course, has a lot less demand this time of year. So, I’m expecting prices to drop.

But of course, we have situations where the Europeans are buying more natural gas from the United States and there are questions about whether or not recession is going to be as bad as originally feared. Nonetheless, this time of year, typically natural gas does fall because the lack of heating demand is a major hamstring for pricing in this market.

I have no interest in buying and if we can break down below the $3.50 level, I think we’ll probably accelerate to the downside, initially testing the 200 day EMA and then trying to get down to the $3 level, which would be my ultimate target as it were. Expect a lot of volatility. This is a volatile market under the best of circumstances. And of course, understand that natural gas is highly, highly susceptible to weather headlines and noise moving the market in erratic momentum.

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