Natural Gas Price Outlook – Natural Gas Continues to Rally

Natural Gas Technical Analysis

The natural gas markets have shown quite a bit of upward momentum. But really, at this point in time, I think you have to look at them through the prism of how many rallies do we have left in the winter? Clearly, we’re in one. Now, the question of course will be whether or not we can break to the $4.50 level. If we can break there, then it’s likely that we could see a lot of upward momentum, perhaps to the $5 level. Ultimately, this is a market that I have no interest in shorting whatsoever. So, with that being the case, I’m just looking for dips to buy.

The $4 level should be support as well, but I also think there’s probably even more support at the $3.60 level. Sooner or later, we are going to focus on spring, but we’ve got some time before that. So, I think we’ve got one, maybe two more bounces and shots higher before we turn around and start focusing on winter being gone. The market breaking down below the $3.40 level could of course break things down significantly, but we’re so far away from that right now, it’s not really a concern of mine.

Natural gas, of course, will continue to monitor the situation in Europe, because Europe has chosen not to have energy. They will have to buy it off the US at about four times the normal cost. So that’s part of what’s going on here. But as things stand right now, there’s clearly no need to short this market. And as a result, I’m looking for dips that offer value.

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