Natural Gas Price Forecast: Targets Higher Levels Amid Signs of Bottoming

Natural gas fell on Tuesday to retest support around the 20-Day MA, reaching a daily low of 3.07 before buyers took back control. Although trading occurred below the 20-Day line earlier in the session, at the time of this writing natural gas is on track to close strong, in the top half of the day’s trading range and above the 20-Day line, now at 3.12. If the day ends with it in a similar position within the day’s range a bullish hammer candlestick pattern will set up.

Another Retest of 20-Day Support

Four out of the past last five days tested support around the 20-Day and each time natural gas fell below the line earlier in the session it traded back above the line by the close. That should be the same situation today. If dynamic support is retained at or above the 20-Day line, natural gas is primed to continue higher. It has been attempting to establish a bottom for the current pullback. But it has not yet made a clear break off that bottom that should engender confidence in the bullish reversal with signs of more aggressive buying.

Weekly Bullish Reversal Triggered

A bullish reversal was triggered yesterday on the weekly chart (not shown). The trigger indicates strengthening in demand for natural gas and it provides another piece of evidence supporting a bullish continuation of the rising trend and the likelihood that the bearish correction may have bottomed out.

The uptrend that begins from the February 2024 trend low triggered a breakout recently on a rally above the 3.02 swing high on November 20. That was concurrent to a symmetrical triangle breakout. Each would be a valid signal on its own but when they occur together the assumption is that upside follow-through should occur with improved momentum.

Bullish Hammer Breakout Above 3.19

After today, strength will be indicated on a rally above today’s high of 3.19 and further still on a move above Monday’s high of 3.32. The internal uptrend that is nearby can be used as a guide as it was previously representing support during the way up. It was specifically tested as resistance last Thursday before the gap up opening on Monday.

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