Natural Gas Price Outlook – Natural Gas Continues to Find Buyers

Natural Gas Technical Analysis

The natural gas markets have shown themselves to be very strong yet again, as we see a lot of interest in the cold weather in the United States driving up pricing. That is of course a scenario that we need to look at as a major driver. At this point, we are trying to go looking to the $4 level. If we can break above there, then that could open up the possibility of a move to the $4.50 level. Short term pullbacks, I think, will offer quite a bit of support all the way down to at least the $3.40 level.

We probably have another pullback and shot higher this winter, maybe two, and then we’ll start to drift back down as future traders will start to focus on spring. Ultimately, at this point, you certainly cannot short this market, so you are either out there looking for dips that you can buy into in order to pick up cheap gas, or you’re just on the sidelines.

That’s really all it is. I don’t see a situation where you would get short of this market, at least not as things stand right now. I would be very cautious, but I am optimistic that we do continue to go higher, and I will trade accordingly. This is a market that is very cyclical and should be thought of in that light. This time of year, leans bullish most winters, and this is one of the most important things to keep in mind.

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