Natural Gas Price Forecast – Natural gas markets fall for the day on Tuesday

Christopher Lewis
Updated
The natural gas markets fell doing the trading session on Tuesday, as the markets continue to drift lower overall. The supply issue always favor selling as there is far too much in the way of proven natural gas reserves. Even if storage drops, the reality is that the drillers will simply fill those tanks back up.

Natural gas markets have formed a very bearish candle during the trading session on Tuesday, as we reach towards the $2.60 level. That being the case, it’s likely that the $2.60 level will cause a bit of an issue, but if we break down below there it’s very likely that the $2.50 level has shown exactly where the “floor” is. At this point, we have drifted a bit higher over the last couple weeks, but we are probably rent about as far as we can, at least easily.

NATGAS Video 22.05.19

The 50 day EMA offer and resistance also makes a lot of sense as shown by the red line on the chart, so given enough time we should see longer-term traders jump in and start shorting. I’m not sure if the $2.50 level underneath is going to hold as a floor, but if we did break down below there it’s likely that we could drop to the $2.25 level. On the other side of the equation is that a break above the $2.70 level could happen. If it does, that could send this market to the $2.80 level rather quickly.

I suspect that short-term rallies should continue to offer nice shorting opportunities, but these will be little micro-moves as the market is at longer-term cyclical lows. Ultimately, this market is a one-way trade if you are patient enough to look for the right entries.

Please let us know what you think in the comments below

This article was originally posted on FX Empire

More From FXEMPIRE: