Natural Gas Price Forecast – Natural Gas Continues to Look Troubled

Natural Gas Technical Analysis

The natural gas markets were somewhat noisy in the early hours on Friday, and at this point in time, a little bit of a bounce did make a certain amount of sense considering we are hanging around the $2 level.

With that being said, the market is likely to continue to see a certain amount of downward pressure this time of year, mainly due to the fact that we have shown so much in the way of negativity that sooner or later short covering has to happen. Furthermore, we are in the midst of a significantly bearish time of year, and therefore I think it does make a certain amount of sense that natural gas continues to falter. Rallies at this point in time continue to be a major issue, and as a result, I don’t think that you can hang on to them too much as far as position size is concerned. However, that doesn’t mean that you can’t be building up a position. It just means that you have to do so slowly.

After all, we will eventually roll over into autumn and the temperatures will start to fall. Eventually that leads into winter and demand for natural gas skyrockets. So that’s essentially how I look at this as an opportunity to add a little bit more to my position. But it’s an investment, it’s a swing trade. It’s something that could last a couple of months. As for short-term movement, you would have to fade the rallies, but quite frankly, there are so many moving parts in the natural gas markets it’s very difficult to trade from the short term perspective.

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