Natural Gas Price Outlook – Natural Gas Continue to Hang Onto the 200 Day EMA

Natural Gas Technical Analysis

The natural gas market seems to be hanging around the 200-day EMA, in what I suspect is going to be an attempt to determine whether the uptrend can continue. Historically speaking, this time of year is very difficult for natural gas as temperatures are rising in the United States and the European Union driving down demand. Now, keep in mind that natural gas is also highly influential in power in the form of electricity.

So, if we also have a situation where there might be a recession in the United States, then that, of course, can drive down demand as well. With both of these things working against natural gas, I am more inclined to the downside than up, but I’m the first to admit that this is a very noisy move. Short-term rallies that show signs of exhaustion, for me, are nice selling opportunities, especially around the $3.50 level.

If we can break down below the lows of the hammer that formed during the Tuesday session, we could see natural gas drop down towards the $3 handle. All things being equal, I think natural gas remains negative, at least for the next couple of months, but that doesn’t mean that there won’t be concerns about European supply because of Russia, those types of things that keep the market somewhat inflated. Furthermore, you have to keep in mind that inflation continues to attempt to pick up, this could also influence the price of natural gas as it does all commodities.

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