Natural Gas Weekly Price Forecast – natural gas gives back gains for the week
Natural gas markets initially gapped higher on Monday and then reached close to the $3.40 level. We found enough resistance there to turn things around and form a shooting star, which is a very negative sign. We gave back all of this gains over the next couple of days, and in the end had a very negative weekly candle. Ultimately, there is a gap below that I think needs to get filled and I believe that’s exactly what we are getting ready to see. I think that the oversupply of natural gas is a longer-term structural problem, so in general I don’t like buying it. We have had the seasonal spike, and it is now dead. I believe we will continue to see the market be what it normally is: selling rallies.
NATGAS Video 21.01.19
The $2.75 level is support, as it was previously. We have made a complete round-trip over the last couple of months, which is typical for this time a year. I think at this point looking for signs of exhaustion to sell will continue to be the way forward, and longer-term traders will simply look to sell every $0.50 or so, Perhaps even every $0.25. I have no interest in buying this market, because quite frankly it cannot sustain rallies, as seen a couple of weeks back. Ultimately, this is much like gold was in the 1980s: you simply sell every time it rallies as it can’t sustain buying pressure for any significant amount of time.
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