Natural Price Outlook – Natural Gas Sees Selling Early on Thursday

Natural Gas Technical Analysis

The natural gas markets have been absolutely hammered during the early hours on Thursday, as it looks like we are trying to form that double top that I had talked about previously. At this point in time, the $4 level underneath would be an area that I’d be watching as it is a large round psychologically significant figure.

And at this point in time, I think you’ve got a situation where traders are perhaps trying to focus on the upcoming springtime and storage report. After all, if springtime shows up in the next week or two, that is going to destroy demand for natural gas. Natural gas storage comes out later in the session and it is expected to be a withdrawal of 191 billion.

But at this point, we’ll have to wait and see how that plays out. If it’s less than anticipated, that might cause quite a bit of selling pressure. Either way, this is a market that has got way ahead of itself and it makes a certain amount of sense that we get a pullback. We are looking at temperatures that are warming up next week in the United States, but at that point, you’re already in March.

So the futures contract will be rolling over here in the next few days on the 26th over into the April contract. So, I think this was the last hurrah for natural gas. We’ll just have to wait and see. I have been saying that there could be another one and it’s a really hard thing to time. But eventually it’ll make itself known. I certainly think there’s more danger in this market and more momentum to the downside likely to occur than up.

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