Natural gas markets have gone back and forth during the trading session on Tuesday, as we continue to dance around above the support level underneath. The $2.25 level is an area that of course offers significant support as it had offered massive amounts of resistance during the month of August. At this point, the market looks as if it is trying to involve “market memory” in this area, as we start to head towards the winter season which of course will demand much more natural gas to heat homes in the United States and European Union.
NATGAS Video 09.10.19
At this point, we are below the 50 day EMA, so we are still technically in a downtrend but as we have seen just below, there is a significant amount of structure. If we can break above the 50 day EMA, then the market probably goes looking towards the $2.50 level, possibly even the 200 day EMA which is about $0.10 above there. Ultimately, natural gas continues to be oversupplied longer-term, but we do get that Winter bounce every year that we can take advantage of, so that’s essentially what I’m waiting for. As a proxy, I am using the 50 day EMA as a buying opportunity. To the downside, I don’t have much in the way of interest in selling, simply because we are at such extended lower levels. The $2.00 level underneath should considered to be the “hard floor” of the market. Quite frankly though, I would be surprised to see this market reach that area.
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This article was originally posted on FX Empire
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