Natural Weekly Price Outlook – Natural Gas Continues to Pull Back

Natural Gas Weekly Technical Analysis

The natural gas market has pulled back just a bit during the trading week to show signs of exhaustion. That being said, this is a market where we’ll find buyers underneath and with that being the case, I think you’re probably going to be looking for a buy on the bounce type of opportunity after this dip. We don’t really have it yet, but it looks a lot like a market that is paying close attention to the 50 week EMA underneath near the $2.50 level.

If we were to get to that area, I think natural gas becomes so cheap that you will have a lot of value hunting. On the other hand, if we turn around and break above the $3.40 level, then it opens up a potential move all the way to $5. Keep in mind, this time of year is typically very bullish for natural gas, but we are about halfway through the season, so one has to wonder how much more juice we have in it.

The market certainly is not one I want to short anytime soon because demand will obviously pick up. But keep in mind that the natural gas markets are driven by futures markets and futures markets are not trading right now, they’re trading in the future. So, in the next month or two, you’ll see natural gas suddenly dip. And the reason is they’re starting to price in the idea of spring. As it is right now though, it is a buy on the dip and bounce type of opportunity that I’m waiting to see set up.

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