Natural Gas Price Forecast – Natural Gas Markets Approaching The 200 Day EMA
Natural Gas Technical Analysis
Natural gas markets initially fell on Monday but did recover to reach the top of the Friday range. That being said, the $6.50 level should now be resistance based upon “market memory, and at the first signs of exhaustion, I will be shorting this market. Yes, the 200 Day EMA sits below but that doesn’t necessarily mean anything. The natural gas demand will be decimated by the fact that Germany and several other European countries are now switching to coal.
The end of the massive bullish run coincided with the Freeport terminal announcing that it would not be repaired as soon as once thought, meaning that LNG exports out of the United States would be hampered. This forces the Europeans to either start buying Russian gas, or switch to coal. So far, it looks like they are more than willing to switch to burning coal, and therefore the European demand situation is not as big of a factor in the Henry Hub contract. After all, this is a contract that is typically more or less focused on US domestic demand, so that is why we have seen such a massive unwind.
Rallies at this point I would treat with suspicion, and even if we did break above the $6.50 level, then I would look at the $7.00 level for a shorting opportunity, followed by the 50 Day EMA which is currently at the $7.44 level and dropping. Historically speaking, these prices for natural gas are ridiculous, especially as natural gas is not exactly hard to find in the United States. Eventually, I anticipate that we go back toward the $4.00 level.
Natural Gas Price Forecast Video for 28.06.22
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This article was originally posted on FX Empire
