Natural Gas News: Bullish Reversal Confirmed as Futures Break $2.187 – Market Forecast

Natural Gas Market Confirms Bullish Reversal

U.S. natural gas futures surged on Monday, breaking through the crucial $2.187 resistance level and confirming a bullish weekly closing price reversal bottom. This move signals renewed bullish sentiment driven by favorable weather forecasts, tighter supply conditions, and increased interest from money managers.

At 13:14 GMT, Natural Gas Futures are trading $2.218, up $0.075 or +3.50%.

Money Managers Boost Bullish Bets

The recent price rally has been supported by a significant increase in bullish bets from money managers. Data from the Commodity Futures Trading Commission and Bloomberg shows that net long positions reached a six-week high during the first full week of August. This shift is largely attributed to the unwinding of short positions and the expectation of rising cooling demand across the Lower 48 states, which has attracted new buyers into the market.

Confirmation of Weekly Reversal Bottom

Last week, U.S. natural gas futures stabilized after testing critical support at $1.907, culminating in a weekly closing price reversal bottom. The market’s break above $2.187 confirms this technical pattern, indicating that buying pressure is now outweighing selling at current levels. This development suggests the potential for a sustained rally, with the next target set at $2.597 or higher, provided that market conditions remain supportive.

Hurricane Debby and Weather-Driven Demand

Hurricane Debby’s landfall in Florida introduced complex dynamics to the market. While the storm reduced cooling demand by bringing cooler temperatures—a bearish factor—its impact was balanced by disruptions in supply chains and power outages. Additionally, cooler temperatures forecasted across northern regions are expected to continue suppressing demand, particularly in the Southeast. However, the overall effect of weather patterns remains a key factor driving near-term market sentiment.

Market Forecast: Continued Bullish Momentum

With the key resistance level at $2.187 breached and increased participation from money managers, the natural gas market is poised for further gains. The confirmation of the weekly reversal bottom suggests that prices could advance toward $2.597 or higher in the near term, especially if weather-driven demand continues to support the market. However, traders should monitor storage data and production levels closely, as any significant bearish developments could quickly dampen the current bullish momentum.

Natural gas futures are higher on Monday after confirming last week’s closing price reversal bottom. The could lead to a 2 to 3 week rally.

On the daily chart, support is the old top at $2.149. The next objective is the main top at $2.315. This is a potential trigger point for an acceleration to the upside with the 50-day moving average at $2.497 a key objective.