Natural Gas Weekly Price Forecast – Natural Gas Gives Up The Gains For The Week

Natural Gas Weekly Technical Analysis

The natural gas markets initially tried to rally during the course of the week to go looking to the $2.25 level only to fail. At this point in time, natural gas, of course, is going to continue to struggle because this time of year is typically very bearish. The $2 level underneath could offer a bit of support, but we’ll have to wait and see whether or not it holds. After that, then you could be talking about a move closer to the $1.50 level.

I am interested in buying natural gas and in fact have bought a little bit through an ETF, but that’s so that I can hang on to it until the end of summer and when we get the inevitable rally, I’ll just sell it. I’ll double my money and move on. That being said, it’s only a percent or two of my portfolio. It’s not a huge position. It never is a huge position because natural gas is an extraordinarily difficult market to trade. Yes, it’s volatile, but it’s because most people don’t even know what they’re trading.

You’re trading the Henry Hub contract in the United States, so therefore it’s all about the United States. There are some exports coming out of the United States into the global market, but for the most part, it’s a domestic market, and therefore you need to be aware of weather patterns, transmission through natural gas lines in the United States, and a whole host of other things like weather in the Gulf of Mexico, whether or not it’s going to disrupt refineries.

That being said, the easiest trade is to take the cyclical trade. So, I’m building up a position again. I had sold off quite a bit of it during the heat wave, and now I’m building up for either the next heat wave or colder temperatures being priced into the futures market. Remember the futures market will be ahead of us. So, in the next couple of months, futures traders will start to focus more on winter.

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