Natural Gas Price Forecast – Natural Gas Markets Pressuring 50 Day EMA
Natural gas markets initially pulled back a bit during the trading session on Tuesday but then turned around to show signs of strength as we are broken above the 200 day EMA. Cool temperatures in the United States may be partially to blame but at the end of the day we are still very much in a downtrend longer-term, and of course warmer temperatures will be coming.
NATGAS Video 14.04.21
With that being said, the market is likely one that you can fade in this general vicinity, and therefore I will be looking at the first signs of exhaustion to start shorting. After all, the demand for natural gas is going to start dropping off, and that should send this market back towards the lows again. Ultimately, I do think that this is a market that you cannot be buyers of, as the 50 day EMA is highly important. Longer-term, I do believe that we go looking towards the $2.25 level, possibly down to the $2.00 level. All things been equal, this is a market that I think continues to be an opportunity to short and a cyclical trade.
Your capital is at risk
If we were to break above the 50 day EMA, then the $2.75 level will attract a lot of attention as we have broken down from that area. After that, the $3.00 level would be a major resistance barrier. After all, this is a market that sees plenty of oversupply longer term, so at this point in time it is simply a matter of waiting for some type of exhaustion in order to get involved.
For a look at all of today’s economic events, check out our economic calendar.