Natural gas markets initially tried to rally during the trading session on Wednesday, reaching towards the $3.35 level. We have pulled back a bit since then, which quite frankly makes sense considering that we had gotten so overbought. Beyond that, the daily candle stick from the previous session was a shooting star, which of course is a negative sign. I think we are simply exhausted at this point as natural gas had gotten expensive. We are getting into the colder part of the year in the United States, so it’s likely that we will continue to see buyers on these pullbacks. If you are a short term trader, selling is probably the best thing you can do, but longer-term traders or for that matter, Trent traders will continue to favor the upside. I think the $3.25 level will be the initial scene of support, but I much more interested in buying closer to the $3.20 level, or even if we get the opportunity the $3.10 level.
If we turn around and break above the $3.35 level, it would be bullish sign but I would be very cautious about that move, because quite frankly we gone too far and too short of a span of time. Overall, I think that this market will continue to favor buying until somewhere in the middle of the month of January. That doesn’t mean we can’t have a significant break down, but the historical attitude of this time a year typically favors rallies.
NATGAS Video 11.10.18
This article was originally posted on FX Empire
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