Potential signal
Selling here.
Stop 3.10 and a target of 2.65 below
The natural gas market has shown itself to be very negative during the trading session on Friday as we continue to see a lot of questions about whether or not the natural gas market can levitate at all. Quite frankly, I do not think we have much shot of it being bullish because this time of year is more often than not going to be bearish for natural gas as traders don't have enough demand coming out of America to bring the price higher.
Natural Gas Market Outlook
Really at this point in time, I think you have got a situation that is going to be anytime we start to rally a bit, it is time to start selling. All things being equal, this market I think could go down to the $2.60 level and anytime that we see some type of rally, it is a nice selling opportunity. The $3.20 level is a barrier right along with the 200-day EMA.
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Ultimately, given enough time, I think that short-term traders are likely to show signs of exhaustion I can get involved with. I have no interest whatsoever in buying natural gas this time of year. It is just what is known as the shoulder season, and that essentially means that natural gas demand is going to be too low. Now, at one point or another, in the summertime, we will see higher pricing due to a heatwave, but those are short spikes. I am really interested in this winter. What are Europeans going to have to do for heat? If they have to import a lot of American gas, this could be an interesting market to watch. As they stand right now though, I think $2.60 is where we end up.
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