Natural Gas Price Outlook – Natural Gas Looking for the Floor on Friday

Natural Gas Technical Analysis

The $3.60 level down to about the $3.50 level should, at least in theory, be somewhat supportive based on previous price action, and we are getting close to filling that gap from the open of the November contract. So, we will have to wait and see whether or not that comes into play, but it does look like the market is trying to support itself.

Keep in mind that natural gas is heavily supplied this year for whatever reason, and therefore I suspect that although we will see bullish action soon, I don’t know if we go to like $7, which was the guestimate when we were ripping higher in the month of November. Keep in mind, there was some noise around the idea that data centers using artificial intelligence would need a ton of electricity, which means a lot of natural gas is being burned. I think that narrative is starting to fall apart a bit, especially as the whole narrative of data centers might be falling apart.

Seeking A Bullish Bounce

Nonetheless, this is a cyclically positive time of year for natural gas, and I am going to look at it through that prism. So, with this, I’m looking for a bounce. If we can clear the $4 level, I think we can pick up serious momentum. I don’t want to short this market as temperatures are cold in the northeastern part of the United States, and I see snow on the ground outside my window.

It just doesn’t make sense to try to fight what should be a bullish time of year. One bad storm being forecasted will have this market rip to the upside. So, it’s a bit of a waiting game, but clearly, I think you are getting to an area where there’s a lot of technical support, so this becomes very interesting to me.

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