Natural Gas Price Forecast – Natural Gas Markets Defend Support

Natural gas markets have rallied a bit during the course of the trading session on Friday to defend the crucial $3.60 level. That being said, the market probably was running out of momentum more than anything else due to the fact that the end of the year was coming and of course we had recently plunged quite deep. When you look at the longer-term chart, you can see that we had busted below a significant descending triangle, and the measured move from that potential break down was all the way down to the $3.00 level. We still have quite a while to go before we get there, so I certainly think that the downtrend still has further legs.

NATGAS Video 03.01.22

Every time this market rallies, I am looking for signs of exhaustion that I can start selling. The 200 day EMA above at the $4.10 level is the ceiling in the market from what I can see, and it currently looks as if it is going to be threatened by the 50 day EMA as it is ready to break down and through it forming the so-called “death cross.” That obviously is a longer-term negative signal, but at this point in time it is hard denying that this is a negative market to begin with. Warmer temperatures in the United States will continue to drive down the value of natural gas anyway, so it is difficult to imagine that natural gas is suddenly going to take off. If it does, I will be looking for signs of exhaustion that I can start shorting yet again as we are far too oversupplied.

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