Natural Gas Trying to Stabilize

Natural gas markets have gone back and forth during the course of the trading session on Monday as we have seen a lot of noisy behavior of the last couple of days. Whether or not we can hang on to the same area is a completely different question, and I do think that ultimately, we do break down. When you look at the descending triangle that ended up being the top of the market, the “measured move” suggests that we are going down to the $3.00 level. That being said, it does not necessarily mean that the market needs to go down to that level immediately, but it certainly makes a lot of sense due to the fact that the $3.00 level has been a bit of a magnet for price over the longer term.

NATGAS Video 25.01.22

Any rally at this point in time probably get sold into, and I certainly will take advantage of signs of exhaustion as they appear. Ultimately, this is a market that I think given enough time will break through the crucial $3.50 support level, but it may take several attempts to actually have that happen. To the upside, I suspect that the $4.25 level offers enough resistance near the 50 day EMA to push the markets back down. Unless of course we get some type of massive change in March, it is very likely that we will continue to see downward pressure over the longer term.

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