Natural Gas Price Forecast: Plummets to 42-Month Low, Eyes Next Target

Natural Gas Forecast Video for 09.02.24 by Bruce Powers

New long-term trend lows were reached today in the price of natural gas as it dropped below the prior trend low of 1.95, to a low of 1.87. And trading continues at the lows of the day, at the time of this writing. That is a 42-month low, and it puts natural gas on track to reaching its next lower target of 1.80. That is a prior swing low from September 2020. Once the breakdown is confirmed with a daily close below that level, and then again on a weekly close below, there is a chance for an acceleration of the decline.

Possible Acceleration of Decline

Certainly, a rapid drop in the price of natural gas has been seen before. The 75% drop from the November 2022 swing high in only 13 weeks is a good example. Regardless, a bearish long-term trend continuation signal triggered today. That should be followed by further declines unless there is a sharp upside reversal quickly.

Below the first target of 1.80 there is a potentially more significant support zone from around 1.61 to 1.44. However, there is a concentration of price levels within that zone that starts with 1.60/1.61. It was a weekly interim swing low in the past and an extended downside target for the ABCD pattern completes there. Further down is 1.52. That price level was a significant swing low in the past. It is followed by 1.44. Support was seen there at a swing low from June 2020.

Downside Follow-Through from Large Bear Flag

It seems fair to say that the rising parallel trend channel that developed from the April 2023 low, was a large bear flag. The 75% decline noted above was the pole. Today’s bearish follow-through clears up any confusion for now. Further confirming the bearish sentiment is the crossovers seen in the moving averages. Both the 20-Day and 50-Day MAs have crossed below the 200-Day MA, they are decreasing the angle of decline.

Although the measuring objectives for targets from the bear flag would be extreme, the indication is that that price of natural gas is increasing likely to lower prices. Of course, downside follow-through is still warranted.

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