Natural Gas Price Forecast – Natural Gas Continues to Recover

Natural Gas Technical Analysis

Natural gas markets were a little bit positive at the very beginning of the week, as it looks like we are trying to reach the $2.50 level. Quite frankly, this is not a market that I like trading short-term because it’s a great way to lose money. Short-term pullbacks are probably buying opportunities, but I use them as an entry into a longer-term investment.

If we have continuation of heat in the South, it’s possible that natural gas demand picks up, but really, it’s a short-term thing. We are getting towards the end of summer, so here fairly soon we will see a spike in the cost of natural gas due to the fact that people will start focusing on heating demand. At this point, I think you’ve got a situation where traders are looking at this through the prism of it, it’s cyclical investment.

That’s how I am looking at it. I go into the market with very little or in this case, no leverage, and I just hang on to an ETF that follows natural gas. That being said, if you are trading CFD positions, you can do so with a small position. The whole idea is to cash out later on this year when the market rises to $3 or maybe even higher than that, as it almost always does.

That being said, in the meantime, you have a small enough position that doesn’t cause you issues. If the market starts to move in your direction, you add a little. If it pulls back, you add a little. The idea is you are just basically killing time between now and the cyclical surge so that when the time comes, and you don’t have to guess when that is, you can cash out and add to your portfolio’s gains for the year.

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