Natural Gas Price Forecast – Natural gas markets try to recover

Natural gas markets initially fell during trading on Thursday but turned around to show signs of life again. Quite frankly, we are a bit oversold but at this point in time nothing has changed from a fundamental standpoint when it comes to the natural gas markets. The $2.50 level above is a major level that will attract a lot of attention, because not only is it a large, round, psychologically significant figure, but it is also the scene of previous support.

NATGAS Video 07.06.19

Market memory dictates that we could see a lot of selling pressure in that area, so I think at this point signs of exhaustion should be sold into. However, if we break above the $2.50 level, we could go to the $2.60 level, which also features the 50 day EMA as well. At this point in time, I think that you should look at rallies as an opportunity to start shorting, as we are most certainly in a bearish market and of course this is the wrong time of year to see natural gas markets rally for any significant amount of time, so at this point I believe that this is a one-way trade.

That doesn’t mean that you will get the occasional bear market rally, but those are short-lived. I have no scenario whatsoever in which I am willing to buy natural gas, because not only do we have a lack of heating demand, but we also have concerns about global growth, which could drive down demand as well.

Please let us know what you think in the comments below