Natural Gas Price Outlook – Natural Gas Continues to See Upward Momentum

Natural Gas Technical Analysis

The natural gas market has gapped higher to kick off the trading session on Wednesday, and it shows that we are just hanging around to show that we are perhaps ready to go looking to the $3 level above. The $3 level of course is a large round psychologically significant figure and an area that we’ve seen a lot of noise at previously. If we can break above there, then the $3.15 level could be the next target. All things being equal.

If we do continue to see buyers all the way down to at least the 50 day EMA, the market is going to be very noisy, but you also have to keep in mind that the market participants have to pay close attention to the weather in the United States. Speaking of the weather, of course we are trying to price in colder weather, and originally, we had a pretty significant spike due to hurricane fears, but those have come and gone.

And now it looks like we’re focusing on the fundamentals again, the fundamentals, of course, being the fact that the futures market is trading winter, we have a big bullish flag here. And if it breaks higher, it could lead to a move all the way to the $3.50 level. But I don’t think it’s going to be easy to get there. And we could be talking December, January, by the time we get there. Generally speaking, the winter is a grind higher after an initial push. And that’s what we’ve had here. If we were to break down below the 50-day EMA though, that would be a very bad sign. Keep your leverage low in this one. I cannot stress that enough.

For a look at all of today’s economic events, check out our economic calendar.