Natural Gas Price Outlook – Natural Gas Continues to Dance Around $4

Natural Gas Technical Analysis

The natural gas markets have rallied slightly during the early hours here on Tuesday as we continue to hang around the $4 level. We are most certainly in a massive state of flux at the moment with natural gas as we are heading into springtime and it’s likely that temperatures will rise shortly. And in fact, the forecast certainly calls for that here in America. And that should drive down demand. The question of course is, when does this trade actually kick off?

Because there will be occasional snowstorms or cold snaps for a day or two this time of year, and it throws the markets into disarray. That being said, one other thing that you need to pay attention to is that on Wednesday, we roll over into the April contract. So that’ll be interesting to see where they start pricing that I would assume is lower, but we don’t know for a fact yet. The market breaking well below the lows of the trading session on Monday for me gets me short of this market again.

And the market has recently formed a little bit of a double top that I’m paying close attention to at the $4.40 region. Keep in mind that this is an extraordinarily volatile market. So, I never trade a lot. And in fact, most of the time, I’m doing it via either an ETF or a small CFD position.

I never trade natural gas futures markets directly, just because of the inherent volatility and the damage you can do. That being said, all pricing in your CFD markets are a derivative of the futures markets that you have to watch them. All things being equal, I do think that we are getting very close to the end of the winter trade, and therefore I’m looking at this through a bearish spectrum.

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