Uncertainty in Natural Gas Prices: A Bullish Turn Ahead?

Natural Gas Forecast Video for 06.11.23 by Bruce Powers

Uncertainty in natural gas prices continued today as it remained within a six-day trading range dominated by the wide range day last October 31. Today’s price action took natural gas above yesterday’s high, creating a higher daily low and higher daily high, which is a minor bullish sign. However, it is looking like natural gas may close at or near the opening price thereby creating a doji candlestick pattern. The doji also reflects uncertainty and consolidation.

Natural Gas Stuck in a Range

Until natural gas moves out of its six-day range from 3.64 to 3.32, trading is likely to continue to be choppy. Nevertheless, the retracement from the trend high of 3.64 has been minor so far, reflecting strength. It has not yet reached a common minimum Fibonacci retracement level of 38.2% at 3.34. The retracement to date found support at yesterday’s low of 3.40. Another way to look at the consolidation range is on the weekly chart. An inside week candlestick pattern will complete this week. The high is at 3.63, slightly lower than the trend high.

Minor Bullish Price Action Today

Although today’s price action is contained within the consolidation range, it is slightly bullish. If there is follow-through it could lead to a breakout to a new trend high. A break above today’s high of 3.58 provides the next sign of strength. Once above today’s high natural gas contends with daily resistance at 3.61 and 3.63. If momentum is strong enough to get above the higher level the trend high at 3.64 has a good chance of being busted to the upside.

Remaining Above 200 Day EMA Improves Outlook

Natural gas is back above the 200-Day EMA for the second time in a month and it looks like this time it should stay above. The first time on October 6 failed as six days later natural gas dipped back below the 200 Day line. This is bullish for the longer-term outlook. An upside breakout to a new trend has natural gas heading to the next potential resistance zone from 3.76 to 3.85. That zone includes the completion of an ABCD pattern as 3.78, as highlighted on the chart.

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