Natural Gas Price Forecast – Natural Gas Continues to See Sideways Action

Natural Gas Technical Analysis

The natural gas markets initially did rally during the trading session on Tuesday, but we continue to struggle with the idea of breaking above the 200 day EMA. The 200 day EMA currently sits right around the $2.39 level and has been very difficult to get above. If we could break above the 200 day EMA, then we would have the resistance barrier at the $2.50 level to deal with. All things being equal, this is probably a little early in the season to expect natural gas to truly take off, and therefore a pullback makes quite a bit of sense.

That pullback could be a buying opportunity if you’re an investor like I am. I’m not a trader of natural gas. I tend to trade massive swings. I also tend to trade in small positions. The last thing that you want to do is to be highly levered to this market and then have it go against you because it is extraordinarily volatile under the best of circumstances. I’d suggest that the $2 level now is a bit of a floor in the market.

So that is something to trade off of. And I would also point out that the $2.20 level has been important a couple of times as well. I’m involved in an ETF, so there’s no leverage for me, and I’m just simply going to collect my profit the next major spike we get. That’s actually more often than not the best way to play the natural gas market. And I do expect another spike in the next few months as we start to focus on colder temperatures in the northeastern part of the United States.

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