Natural Gas Weekly Price Outlook – Natural Gas Continues to Consolidate

Natural Gas Weekly Technical Analysis

The natural gas markets have had a tough week, but quite frankly I think a lot of this is just the market pulling back from the top of the consolidation area that it’s been in all year. Ultimately, this is the time of year where natural gas does fairly well, most of the time due to more demand coming into the picture. With that being said, I think you’ve got a situation where the colder temperatures coming over the next couple of months in the Northeastern part of the United States should continue to drive natural gas higher, but we are just simply sitting here waiting for some type of fundamental reason to continue to take off to the upside.

Short-term pullbacks at this point in time almost certainly attract a significant amount of attention. And with the 50 week EMA sitting just below the current trading area, it does make a certain amount of sense there might be a little bit of technical support.

Underneath there, we could fall all the way down to the $2 level, which has been supported multiple times in the past. And it’s difficult to imagine that it won’t be this time as well. If we were to break above the $3.20 level, it opens up a move to the $3.50 level, which in turn would open up a much bigger move. Now, I don’t expect to see that, but it is something that could in fact happen, at least it’s in the realm of possibilities.

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