Natural Gas Price Forecast January 5, 2018, Technical Analysis
Natural gas markets went back and forth during the session on Thursday, just as we had on Tuesday and Wednesday. I believe that the market continues to struggle in this area, but eventually we should see sellers jump back in as we cannot hang on to gains for any length of time that matters in the natural gas markets this winter. Even though this is a strong time a year typically for natural gas, the reality is that the buyers continue to fail. Because of this, I believe that sellers are looking to get involved on signs of exhaustion, or of course an impulsive move to the downside.
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I believe that the market will then go looking towards the $2.75 level, which has been very important. I believe a breakdown below there should send the market even lower. However, I think that the $2.50 level is the absolute bottom of the market, and I would be stunned if we break down below there. There is a massive amount of resistance between now and the $3.20 level, so I think regardless what happens, we will not break above that level. Signs of exhaustion give us an opportunity to start selling a market that continues to reward sellers, but at this time a year we should be seeing more bullish pressure, which has been a bit disappointing for those who would be buyers. Natural gas is far too oversupplied to continue going higher for a significant amount of time, and there are no signs of this change in anytime soon.