Natural Gas Price Outlook – Natural Gas Continues to See Questions

Natural Gas Technical Analysis

The natural gas futures market has been fairly noisy over the last several sessions, but that does make sense considering that the $4 level, of course, is an area that a lot of people will be paying close attention to.

That being said, when I look at this, we did form a little bit of a double top, and I think the $4.40 level will now be your ceiling. Nonetheless, I think market participants will be watching the temperatures as it should end up favoring lower prices as demand should fall in the United States. And in fact, we’re rolling over into the April contract right now, which of course is the beginning of spring.

So, with that being said, the market breaking down from here could open up a move down to the 50 day EMA, possibly the $3.50 level. The uptrend line underneath will have to be paid close attention to, but this time of year, quite frankly, I don’t like buying natural gas. Yes, we could get a cold spell or something that could cause another spike, but the momentum is most certainly going to be to the downside here over the next couple of months as temperatures increase in the United States but are not hot enough to actually cause air conditioning use.

So, I’m negative on this market but I also recognize you need to be cautious. It can be extraordinarily volatile and shorting can get you into a lot of trouble if we do in fact get some type of bullish news.

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