Natural Gas Price Forecast – Natural Gas Markets Continue to Knock on the Door of a Breakout

Natural Gas Price Forecast Video for 05.10.23

Natural Gas Technical Analysis

As I write this article, the natural gas futures markets are sitting right at the $3.00 level, which of course is a large, round, psychologically significant figure. It’s worth noting that this area has been a bit of the ceiling as of late, we do see the 200-Day EMA reaching toward it at the same time. Because of this, it is very likely that we are going to see a fight in this area but we have a lot of things to consider when looking at the natural gas market.

The first thing of course is going to be the idea that demand is almost certainly going to pick up over the next several months, and traders are going to have to price in the idea of a cold winter. Furthermore, we have the European Union which has no idea as to where it’s going to get its gas, except for perhaps liquefied natural gas coming out of the United States. In other words, it’s going to directly affect this market, and send prices higher than usual this winter.

Underneath, we have the 50-Day EMA, which of course has a certain amount of influence as well. Because of this, I think you’ve got to look at this through the prism of a market that continues to see a lot of external pressures, and will almost certainly pay close attention to the same old issues. The war in Ukraine is going nowhere, and therefore it’s difficult to imagine that suddenly Russian natural gas will be available this winter. The Norwegians have done everything they can to increase production, but they cannot match the production capacity of Russia.

Furthermore, you have the West African pipelines that are a big question at this point, due to the recent revolutions. With all of this being said, it looks like we could have a very volatile but positive winter for natural gas and therefore I am not only a buyer of natural gas, but an investor at this point. Unlevered positions are how I’ve chosen to go, because it allows me to wait for the breakout. Ultimately, I think we go looking toward the $5 level.

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