Natural Gas Daily Forecast – Natural Gas Continues to Recover, for Now

Natural Gas Technical Analysis

The natural gas markets did rally pretty early during the trading session on Friday as we continue to see a lot of noisy behavior. And of course, the natural gas markets are volatile under the best of circumstances anyway. That being said, it does make a certain amount of sense that we would see hesitation. It’s not the right time of year for natural gas to be inherently strong. True, there is a bit of a heat wave in the southern part of the United States at the moment, but that’s probably going to have a limited effect on natural gas demand. Even if it does spike, it’s going to be short-term in nature.

What I have been doing is building up a position for the fall, which I will dump off once price spikes for the heating season. That being said, I did earlier this year take half my position in profit due to the last heat wave, but you really can’t count on those in the summertime, although they do happen from time to time. The real demand picks up in autumn when the Northeast Empire of the United States starts to heat homes.

Once that happens, we have a very good shot in natural gas being an excellent investment. And that’s the key word, investment. You don’t want to be heavily levered to natural gas. You want to recognize that it is something that has a very somewhat well-defined cycle to it and take advantage of it. It’s far too volatile and there are far too many variables to get it right on short-term charge. So, in short, you don’t want leverage. You want to have a position that you can hang on to for months if need be. That’s been the easiest way to trade natural gas that I have ever found.

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