Natural Gas Weekly Price Forecast – Natural Gas Makets Continue to Show Strength

Natural gas markets initially fell during the week, reaching down towards the $1.60 level where we found quite a bit of support. This makes sense, because the $1.60 level begins a massive amount of support down to the $1.50 level, an area that has been crucial from longer-term charts going back several years. At this point in time, I believe that this market is trying to build up a bigger base, but it also has a massive amount of crosscurrents blowing through the market that will cause some issues.

NATGAS Video 27.07.20

We have plenty of bankruptcies out there that should continue to drive supply down a bit, and at the same time we also have plenty of hot temperatures in the United States to drive up demand. This is not to say that we are suddenly entering a longer-term bullish market, just that it makes sense that we are a little bit elevated. I think this market is probably best trade from short-term perspective anyway, as we are bouncing around between the $1.50 level and the $2.00 level.

Playing the back and forth should be profitable, but it is difficult to do from the weekly timeframe. If we do break above the $2.00 level significantly, then the next target will be the $2.50 level, an area that features the 200 week EMA racing towards it. That tends to be a fairly reliable indicator from the longer-term, so it is obviously worth paying attention to. If we were to break down below the $1.50 level, that would be a rather significant break down in an area that has been so reliable for so long.

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