Natural Gas Weekly Price Forecast – natural gas markets break out

The natural gas markets broke out during the week, slicing through the top of a shooting star from the previous week. That of course is a very bullish sign, and I think it means that we are going to have plenty of buyers given enough time. However, we have gotten ahead of ourselves so I think that we will probably pull back a little bit. The $3.00 level underneath should offer support, and I think it will be difficult to break down below there. Ultimately, if we did break down below there we would reenter the previous consolidation area but quite frankly this explosive move to the upside has been rather surprising. It shows just how much wherewithal the buyers have, and we are course in the seasonally bullish time of year. However, I think it’s only a matter time before we get a bit ahead of ourselves again, so I think it’s difficult for the longer-term trader to start buying here. Quite frankly, if you have missed the move higher, the longer-term trader is probably going to be better served waiting for some type of exhaustive candle to start shorting.

Short-term traders may be able to buy this market, but if you are a longer-term trader you’ve missed the move at this point, because although we could certainly go higher, I think that the risk to the downside is still there because we are so overbought. Remember that this pair tends to be very erratic.

NATGAS Video 08.10.18