Natural Gas Price Forecast – Natural Gas Markets Drift Lower
It should be noted that next year, we will see a historically low amount of natural gas produced. This is for a multitude of reasons, not the least of which is the fact that there will probably be bankruptcies. Beyond that, pricing simply doesn’t allow the kind of massive amount of drilling and production that we have seen. Quite frankly, a slew of bankruptcies would be the best thing that could happen for this commodity, because it has gotten far too abundant. Having said that, the market looks as if it is going to continue going lower for a while, we should see some type of turnaround based upon the fact that we are very extended, but we aren’t there yet. Because of this, the market is likely to continue going towards the $1.60 level underneath.
NATGAS Video 10.04.20
Alternately, if the market breaks above the two point to zero dollars level, it’s likely that the market can rally another $0.20 or so. Ultimately, this is a market that should continue to see a lot of noise, but I still favor the downside as this is a market that is far too overabundant and obviously the longer-term trend is negative. That being said, I also don’t necessarily think that we are going to break down below the lows though, which has the $1.50 level underneath. If we were to break down below there who knows what would happen next, as it would be extraordinarily negative. On the other hand, if we were to break above the 200 day EMA which is closer to the $2.20 level, it’s likely that the market will continue to go even further. At this point though, I like shorting the market on rallies that show signs of exhaustion.
This article was originally posted on FX Empire
