Natural gas markets have shown signs of life again on Tuesday, as we have rallied a bit after breaking through the $2.75 level on Monday. This is a major break down as far as the longer-term charts are concerned, but quite frankly we had gotten a bit ahead of ourselves so I feel that it is necessary to bounce in here as things gotten out of hand. The market has been in a downtrend for quite some time, but because we have gotten so overextended, I think this bounce is an opportunity to sell this market yet again, perhaps at the 20 day EMA above pictured in green.
NATGAS Video 06.02.19
I like the idea of selling exhaustion in this market, but quite frankly we can’t sell down at these lower levels because we have sold off so drastically. Looking for an opportunity to sell at higher levels is without a doubt the best way to get involved, as it gives you more of an opportunity to gain real estate. The 200 day EMA is near the $3.22 level, so I don’t think that there’s any opportunity to rally for a longer-term, so therefore I don’t have any interest in buying whatsoever. I believe that the oversupply of natural gas will continue to be a major issue and should continue to depress pricing in this commodity. Longer-term, I think that we will eventually bottom out somewhere near the $2.50 level where there has been an extraordinarily large amount of support in the past.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
More From FXEMPIRE:
- GBP/USD Price Forecast – British pound pulls back
- E-mini S&P 500 Index (ES) Futures Technical Analysis – February 5, 2019 Forecast
- EUR/USD Price Forecast – Euro finding support
- Silver Price Forecast – Silver markets continue to grind sideways
- Gold Price Forecast – Gold markets continue to grind
- AUD/USD and NZD/USD Fundamental Daily Forecast – RBA Lowe’s Speech Should Clarify Next Move in Policy