Natural Gas Is Losing Ground As Traders Bet On Lower Demand
Natural gas pulled back as traders focused on yesterday’s EIA report and reacted to disappointing weather forecasts, which indicate that demand would decline next week.
From the technical point of view, natural gas failed to settle above the resistance level at $3.20 – $3.25 and pulled back towards the $3.10 level. In case natural gas settles below $3.10, it will head towards the nearest support, which is located in the $3.00 – $3.05 range.
On the upside, a successful test of the resistance at $3.20 -$3.25 will push natural gas towards the next resistance at $3.40 – $3.45.
WTI Oil Rallies As Traders Bet That U.S. Would Strike Iran
WTI oil rallied as traders bet that U.S. would strike Iran soon. President Trump has recently said that the U.S. could use the “Mother of all Bombs” against Iran. He also noted that the U.S. would not use nuclear. Trump added that the Iran war would be “over very soon”.
Meanwhile, Iran noted that it prepared for a potential attack. According to Iran, the threat is imminent. Traders also believe that another round of war between U.S. and Iran is inevitable.
Iran continues to attack vessels in the Strait of Hormuz. The country is not ready for serious discussions on its nuclear program, which was the key reason for the military operation against Iran. In turn, the U.S. is not ready for concessions and continues to put maximum economic pressure on Iran, using sanctions and naval blockade.
It looks that both sides of the conflict see escalation as a way out of the current situation. I’d note that Iran may strike oil facilities in the region in case the U.S. resumes the military operation, which is the key threat for oil markets.
I’d also note that the market prepares for a potential attack before midterm elections. Previously, Trump said that he would not attack Iran ahead of elections. However, nobody would outline their true plans to the enemy, so it is likely that the U.S. could start a new operation against Iran ahead of elections. Judging by market dynamics, many traders are ready to bet on this scenario.
Currently, WTI oil is trying to settle above the resistance level at $100.50 – $101.00. In case this attempt is successful, WTI oil will head towards the next resistance level at $106.00 – $106.50. RSI is in the moderate territory, so there is plenty of room to gain momentum in the near term.
Natural Gas Price Forecast
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See all Natural Gas forecastsBrent Oil Tests Resistance At $109.00 – $109.50
Brent oil has also gained strong upside momentum as traders prepared for escalation in the Middle East.
Currently, Brent oil attempts to settle above the resistance at $109.00 – $109.50. This resistance level has been tested many times and proved its strength. In case Brent oil manages to settle above the $109.50 level, it will head towards the resistance level at $114.50 – $115.00.
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