The natural gas market has been going sideways for a while now, and it looks like we are still trying to sort out the momentum in this market, something that has been somewhat missing for a while now. However, I still favor the upside.
The natural gas markets have rallied slightly during the early hours on Friday as we continue to go sideways overall. It is probably worth noting that the 50-day EMA underneath continues to offer support, and I think that is something that you need to keep in the back of your mind. As market participants continue to question whether or not the market is going to finally see enough demand to push natural gas over the $3.15 level, or if we are just going to kill time in the meantime. It looks like a 50-day EMA floor is currently on the market as we have formed a little bit of a double bottom, so that might be something worth paying attention to.
But even if we break down below there, we have the 200-day EMA at the $2.50 level, which shows a lot of support as well. If we do break above the $3.15 level, then I think you’ve got a situation where the market finally takes off and goes looking to the $3.50 level, but I think that’s going to take a significant amount of exterior pressure, probably in the form of temperatures dropping significantly in the Northeastern part of the United States and places like New York, Boston, Philadelphia, Cleveland, Pittsburgh, etc. So, with all that being said, I think we go sideways in the meantime, so short-term dips probably offer buying opportunities, but before it’s all said and done, I’m still bullish than anything else.
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Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.