Natural Gas Price Forecast – Natural Gas Markets Rally Yet Again

Natural gas markets have rallied a bit during the course of the trading session on Wednesday to reach towards the $4.00 level. The 200 day EMA sits at the $4.13 level, so it is obvious resistance. At this point in time, I will be looking for an opportunity to short natural gas, but I do not have the exhaustive candlestick to do so yet. Keep in mind that the markets are going to be rather thin for the rest of the week, as we do not have much in the way of liquidity. After all, traders are going to be focused more on holidays than natural gas.

NATGAS Video 23.12.21

Furthermore, the demand for natural gas is going to continue to drop, as temperatures in the United States are not dropping very much. All things being equal, this is a market that is going to be a “fade the rallies” type of situation, and based upon the descending triangle above, we should be projected for a “measured move” down to the $3.00 level. Rallies at this point in time should offer plenty of opportunity, and even if we broke above the 200 day EMA, I would be looking to short this market near the 50 day EMA.

To the downside, if we were to break down below the $3.64 level, then it is likely that we could go looking towards that $3.00 level. Obviously, the $3.50 level could cause a little bit of psychological support, but I think that is only a minor feature on the way down to targets. I think at this point, we will probably posit that area, but that would be just a blip on the radar.

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