Natural Gas Price Outlook – Natural Gas Continues to Struggle With its Ceiling

Natural Gas Technical Analysis

The natural gas markets have gone back and forth over the course of the last 24 hours as we continue to test the $4 level in the futures market. That being said, I think short-term pullbacks are probably more likely than not, especially as we are starting to determine whether or not the market is going to see more cold weather or not.

After all, the United States, of course, is a major consumer of natural gas, and this, of course, is a US-based contract, not only in the futures market, but most CFD contracts are actually based on Henry Hub in the US. So, with that being said, I think you have to pay close attention to the weather reports. And we are getting a lot of cold weather in the United States, but we are also getting ready to roll over to the March contract. And that’s when we start to think a little bit about springtime.

So, I think we might get one more shot higher after a dip and then after that, we might be done with the cycle. Remember, natural gas is a very cyclical market. And although there are concerns in Europe about getting enough energy, the reality is the warmer weather in the United States will put downward pressure on this market if and when they start to price it in. So be very cautious with that. Right now though, in the short term, I like the idea of buying short-term dips to take advantage of value.

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