Natural Gas Weekly Price Forecast – Natural Gas Has Big Week

Natural gas markets have had a big week, breaking above the $3.00 level to show signs of continued strength. That being said, there was a gap at the $3.00 level on the daily chart that got filled on Friday, and we have pulled back since then. Now the market may focus on the gap underneath, meaning that we could sell off. This would make a certain amount of sense, due to the fact that the seasonal trade certainly does not favor natural gas rising into the springtime as demand typically falls due to less heating demand. Because of this, I do believe that looking at a situation where fading the rallies still continues to work.

NATGAS Video 08.02.21

To the downside, that gap is huge and is centered on roughly $2.50, so I think that is where we are going. That does not mean that we get there quickly, and it does not mean that we cannot rally between now and then. But what it does mean is that we more than likely will continue to see a lot of volatility and downward pressure due to the fact that heating demand will certainly drop. With that being the case, I do believe that this is going to end up being a nice shorting opportunity, but you obviously will have to be patient. I would also be cautious about putting too much money into the trade, because obviously it can be very volatile this time of year. With that, I have no interest in buying because it is most certainly the wrong time of year to do so, as demand should be dropping as per usual.

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