Natural Gas Price Forecast – Time to Pull The Ripcord?

Natural Gas Technical Analysis

The natural gas markets have a decidedly a tired look about them and my emails are starting to be based around this: What should I do with natural gas? How do I trade natural gas? Can you help me trade natural gas? Which is the clearest sign of a top that I know of. That doesn’t mean that it’s right now, obviously, but I think the $3 level is sufficient enough psychological and structural resistance to start to think about the idea of getting out.

There is a hurricane in the Gulf of Mexico region or something that’s about to become a hurricane, and that could shut down production, but quite frankly, we have almost certainly priced that in. After all, we’re up about maybe 80 cents in the week and at that point in time you’re looking at about a 35% or so increase in a week. So, when I start to get people asking me to help them to get involved in a market that has been very bullish for a while, that almost always tells me that the experts are about to hand their positions over to people who have no idea what to do with them and then let them carry these bags.

That doesn’t mean that we can’t go higher, but as of today I am getting out of my ETF position taking profit waiting for a significant pullback and then playing the cold weather trade. The thing about the natural gas market is leverage will kill you and you have to think more in cycles than the day-to-day noise.

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