Natural Gas Weekly Price Forecast – Natural Gas Continue to Power HigherThe natural gas markets rallied quite significantly during the course of the week as we are now focusing on the November contract.
Natural gas markets have initially dipped during the week but found plenty of support near the $2.50 level to turn around and rally yet again. This is a market that has been very bullish as of late, and it should continue to be as the colder temperatures in the northern hemisphere will drive up demand for natural gas. Furthermore, we have seen a lot of bankruptcies when it comes to this industry, so supply will start to dwindle a bit. Do not get me wrong though, because the market is going to be supplied with plenty of natural gas eventually, as prices rise.
NATGAS Video 28.09.20
With this, I believe that we have a short-term opportunity to pick up natural gas and make profits to the upside, as it is a cyclical and seasonal trade. If we can break above the $3.00 level, that could open up another $0.50, possibly even $1.00 to the upside over the next couple of months. To the downside, if we break down below the $2.50 level then we probably have to reset the entire situation and take a look at everything again. As a general rule, it is not a good idea to short natural gas heading into the winter months in America and the European Union, and this year looks like it is going to be more of the same. This does not mean that we cannot break down a bit occasionally, but it is possible that people will look at that as an opportunity to pick up value.
For a look at all of today’s economic events, check out our economic calendar.