Natural Gas Price Forecast: Bullish Momentum Grows, Targeting Key Resistance Levels

Natural gas triggered a bullish trend continuation signal on Thursday, following Wednesday’s new daily closing high for the advance. For the past couple of days, it has been attempting to solidify a breakout above the interim swing high of 2.27. That swing is part of the prior bear trend price structure of lower swing highs. A sustained rally above it followed by a daily close above it will further confirm a continuation of the rally. Although the level was exceeded briefly yesterday and today, natural gas has not yet closed above it. Nevertheless, the buyers remain in charge.

Short One-Day Pullback

A one-day pullback was reversed yesterday leading to trend continuation signal. It was further confirmed with today’s advance to a high of 2.30. Resistance was seen off that high and was followed by a pullback to below the 2.27 pivot. At the time of this writing natural gas is poised to end Thursday’s trading session below the 2.27 level as it is trading within the lower half of the day’s range. Yet, a new higher daily higher and higher low should complete today.

Potential Support Begins at 2.13

Given the quick recovery of the bull trend following a one-day decline, it looks likely that natural gas may continue higher before a deeper pullback. Nonetheless, there are a couple potential support zones to be aware of. First, there is the pullback low of 2.13 from Tuesday. It is quickly followed by the 20-Day MA at 2.10. There is also the 50% retracement level at 2.07.

On the Upside

On the upside, natural gas has been rising following a -40.2% drop from the June 11 swing high of 3.16. That peak was a failed bullish breakout attempt above a prior trend line (blue dots). It remains on the chart only as an additional guide. The current advance has the potential to again attempt a breakout of the top trendline, which has been redrawn to account for the June 11 lower swing high. Therefore, the outlook for natural gas remains bullish.

Initial upside targets start with the 31.8% Fibonacci retracement at 2.37. Given the potential upside momentum it seems likely that this price level would be exceeded. The 50-Day MA is then at 2.40. Since the 20-Day MA was exceeded, the 50-Day line at 2.52 becomes the next moving average target, along with a previous pullback low at 2.475.

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