Natural Weekly Price Outlook – Natural Gas Has a Tough Week

Natural Gas Weekly Technical Analysis

The natural gas market has broken down significantly during the course of the trading week to test a major trend line and then bounce, I think all things being equal, this is a market that still is going to continue to see a lot of selling pressure with the $4 level being a ceiling and the $3 level possibly being a target. Keep in mind this time of year is typically fairly negative.

And now that we’re getting somewhat towards the end of the heat wave in the United States, it makes a lot of sense that we would see natural gas drop as the demand for electricity should drop for air conditioning. Furthermore, we have the Israelis and the Iranians coming to a ceasefire and that protects Iranian natural gas fields, keeping China from stepping into the bigger market and other countries that buy natural gas from Iran.

Well, things being equal this time of year typically were lower, so I’m still looking for fading opportunities, and a break on the weekly candlestick would in fact be a very negative turn of events. However, I suspect you’re probably going to have to time your trades off of a shorter timeframe, such as the daily chart. If we were to break above the $4 level, then maybe we would get back to $4.50, but I also believe we need some type of external factor to make that happen. We formed a massive shooting star in the previous week and then broke down significantly, only to bounce. I think that shows that we’re more in a sideways, with a slightly negative tilt type of market.

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