Natural Gas Remans Confined Within Expanding Triangle

Natural Gas Forecast Video for 24.04.23 by Bruce Powers

Natural gas further consolidates in a developing expanding triangle at the bottom of its trend. An attempt was made earlier in the week to breakout above the 34-Day EMA trend resistance but was quickly met with selling pressure the next day that turned natural gas back down. It could continue to fall in the short term and even drop to new trend lows.

However, that would not provide a confident bearish signal on its own as the lower border trendline of the triangle is currently below the prior trend lows. Price could drop lower but remain within the consolidation structure borders.

Pullback to Lower End of Range Provides Better Prices for Entry

A decline closer to the lower trendline of the pattern would provide a better price to consider natural gas, assuming it eventually reverses higher before new trend lows. Lower prices would allow for a tighter protective stop; however, one should be aware of issues with the expanding triangle. A stop at a new trend low may be at a price that is within the borders of the triangle. If this is the case, support could still be seen and turn natural gas higher. Natural gas would need to close on a daily basis below the lower line of the pattern for bearish confirmation.

Week to End with Bearish Candlestick Pattern

Unless natural gas turns up soon, before the end of the week, it will complete this week as a bearish shooting star candlestick. This pattern is not as significant as it could be given the position within the pattern. It can be particularly bearish near the top of a trend or upswing. Given that it is contained with the developing triangle, it can be considered as short-term bearish. This also means we should watch this week’s low of 2.14 for signs of weakening as a decisive drop below it could see price continue lower for a potential retest of prior trend lows and the bottom of the triangle. Weekly price levels are more significant than daily.

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