Natural Gas Price Forecast – Natural Gas Continues to See Downward Pressures

Natural Gas Technical Analysis

The natural gas markets continue to look very noisy at this point in time and I also believe that we are in the process of trying to find a bottom. The question now is whether or not we can find that bottom near the $2.50 level as the market will of course pay attention to these big figures. I believe that natural gas was overdone due to the heat wave in the United States and now that that has gone away, I do think that you continue to see a little bit of softness in this market. If we break down below here, then we could go looking toward the $2.25 level, possibly even the $2 level.

Now for myself, I am already long at this market, but I own an ETF position. I don’t lever natural gas because quite frankly, natural gas is a very dangerous contract to trade without some type of expertise on weather patterns, transmission flows through lines in the United States from one section of the country to the other, geopolitics, et cetera.

So, I tend to keep my position sizing low leverage. I suspect that if you are in this market, you should be as well. I do like the idea of buying dips and I will add to my ETF position, but I’m not going to jump in with a ton of money. This time of year, is typically rather quiet for natural gas, so I expect a fall towards more historically normal pricing underneath.

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