Natural Gas Price Forecast – Natural Gas Continues to See Selling

Natural Gas Technical Analysis

The natural gas markets continue to bounce around after selling off earlier in the week. At this point, I think you have a situation where traders are just simply looking for some type of value and trying to take advantage of it. However, I would be a little bit cautious about getting overly bullish natural gas here, although we have had a nice run higher.

It’s typically not the best time of year for natural gas and temperatures have cooled in the United States in various places. So that of course has its own influence. With that being said, I like the idea of buying natural gas eventually, but I want to buy it at a lower level. I currently am invested in natural gas in an ETF and therefore I don’t have to worry about leverage. I also took about half profit on the way up actually not too far from where we are now.

If we can recapture $2.50, then I think the market probably goes looking towards the highs again. However, I suspect it’s probably easier to get down to the $2.20 level, where I might be interested in taking a peek at adding to a position. All things being equal, natural gas is a market that you have to be very cautious with, as leverage can get you hurt really quickly.

This is a market that given enough time will have to correct itself, I think. But as things stand right now, I believe we have a situation where you just want to step back and perhaps give it an opportunity to prove itself before you put money to work. Ultimately though, if we do break down, I wouldn’t be a seller. We’re just at extremely low levels to begin with. I would just welcome that opportunity to invest in natural gas, not lever myself.

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