Natural Gas Price Forecast – Natural Gas Continues to Power Higher

Natural Gas Technical Analysis

The natural gas market continues to see a lot of noisy behavior, as every time we pull back, there seemingly are people willing to jump in and take advantage of cheap gas. That being said, I do think that this is a market that continues to be very noisy in general, but I think you also have to keep in mind that this is a market that does seem like it’s willing to do everything it can to get to the $2.50 level.

It is probably worth noting at this point that traders are more likely than not going to continue to see the Chinese situation as particularly interesting as it looks like they are converting a massive amount of big rigs and buses in that country over to natural gas. So that might be part of the arbitrage that we’re seeing why oil is falling apart and that gas is starting to take off. If that is going to be a longer-term thing, this could, at least in theory, change the attitude of this market going forward. Only time will tell.

Furthermore, we also have the cyclical trade, which late in the year, the temperatures cool off, people look for heating demand to pick up, and that of course is a perfect recipe for natural gas to continue climbing. If we can break above the $2.50 level, then I think we have exit velocity, and we will eventually spike towards the $3 level. Short-term pullbacks should continue to offer buying opportunities.

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