Natural Gas Price Outlook – Natural Gas Continues to See Support After Gapping Lower

Natural Gas Technical Analysis

The natural gas market gapped a bit lower during the early hours on Monday, but we have recovered quite a bit, and as I record this video, we are testing the 50-day EMA. All of that being said, if we can continue to go higher, then I think we will reenter the previous consolidation range, which of course makes a certain amount of sense. After all, this is a time of year where natural gas demand does tend to pick up a little bit. And furthermore, you also have to keep in mind that natural gas is a well-known cyclical market.

So, a lot of traders will just simply jump in at a certain time of year and hang on to it like yours truly. Now that doesn’t mean that I do a lot of leverage with my position. It’s just a small part of my portfolio every year. So, I do think that we may try to build up enough momentum to reach the $3.15 level again, but it’s probably going to take some time. It is at the $2.50 level that I would pull the rip cord and say that we are done for the year, but recently I’ve just been buying dips, collecting a little bit of profit, waiting for a pullback, buying another dip, et cetera, et cetera. Sooner or later, the market turns, and you’re stopped out and you don’t bother with it for six months, eight months.

At least that’s how you trade it in the States. Now, if you have access to really good weather data, transmission numbers, demand numbers, electric production in the Northeastern part of the United States, that type of thing, then you can trade it on a more day-to-day basis. But as things stand right now, we are in the high season, so you have to look towards the upside.

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