Natural Gas Weekly Price Outlook – Natural Gas Continues to See Selling

Natural Gas Weekly Technical Analysis

The natural gas markets have fallen again during the course of the week to break down below the $3 level. The market breaking down below the $3 level, of course, is something that’s important. And it is something the traders will be paying close attention to, as I think you’ve got a situation where now the floodgates could open. Keep in mind that this time of year we typically don’t have a lot of demand for natural gas as heating demand collapses in places like the Northeastern part of the United States, a major customer for natural gas. Furthermore, we also have to consider the fact that a lot of people out there are concerned about a potential recession in the US.

And if we do in fact get a recession, that drives down demand for electricity, which drives down demand for natural gas, which produces a lot of electricity in the United States. So, all things being equal, there are a lot of things working against natural gas. And I do think we will continue to fall. Now that doesn’t mean we won’t get a positive week here or there. But overall, I’m looking at rallies as selling opportunities and just don’t have any real interest in trying to buy natural gas in this type of environment. Ultimately, I think you’ve got a situation where natural gas is just something that might be somewhat toxic for the next several months and should be approached as such.

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