Natural Gas Price Forecast – Natural Gas Continues to Rally

Natural Gas Technical Analysis

The natural gas markets have been very noisy again, but overnight have rallied a bit to test the highs. This is a market that continues to find plenty of buy on the dip trading, but we are recognizing a significant amount of resistance above at the $3 level. This is predicated mainly on a lack of European supply. The Dutch prices have recently gone through the roof, but it is also predicated on the idea that there is a heat wave coming to the United States late in June, next week supposed to be like 90 degrees in the northeast, and 90-95 I think that translates to about 30 Celsius or it might be 300 I don’t know.

Anyways it’s hot so the idea of course is that there will be more electricity needed and that gas does fire a lot of the electrical plants. This is a temporary thing though, so keep that in mind, at least from the US side of equation the 3$ level of course is going to continue to offer resistance but if we can break above there, then we could really start to take off to the upside.

I’m more of a buy-on-the-dip trader in this and I don’t use leverage, I use an ETF out of the United States called UNG. Because of this I can ride through this volatility and I don’t have to worry too much about the fact that natural gas can rip your face off if you are highly levered. If you can only trade CFDs, I would recommend small positions. It’ll just make your life much easier.

For a look at all of today’s economic events, check out our economic calendar.