Natural gas markets have rallied a bit during the trading session on Friday to reach towards the 50 day EMA before turning around to show signs of resistance. The $1.80 level is essentially “fair value”, due to the fact that it is between the support and resistance of the overall consolidation. The $1.60 level underneath is a massive support level, just as the two point to zero dollars level is a massive resistance level. That being the case, we are right in the middle of that noise and therefore you will see a lot of push and pull. However, we are in a longer term downtrend so one would have to favor selling still.
NATGAS Video 20.04.20
Natural gas is oversupplied in the latest inventory numbers were worse than anticipated. They weren’t as bad as they could have been, so I suspect that might be part of the reason why we have rallied but at this point the global economy is essentially locked down, and therefore it’s difficult to imagine that there is going to be a lot of demand. Furthermore, the weather is starting to go warmer in the northern hemisphere, so therefore it’s likely that there will be less demand just from a seasonal perspective. With all that being the case, I find it very difficult to believe that the natural gas markets are simply going to take off to the upside. I believe that there is still a ceiling at the $2.00 level, and it’s not until we get several bankruptcies in the natural gas sector that we have any significant amount of bullish trending.
This article was originally posted on FX Empire
More From FXEMPIRE:
- USD/CAD Daily Forecast – U.S. Dollar Declines On Broad Market Optimism
- May Oil Contract Falls Ahead Of Settlement Date While June Contract Trades At $25
- Gold Price Prediction – Prices Drop on Profit Taking
- S&P 500 Price Forecast – Stock Markets Gap Higher on Friday
- Natural Gas Weekly Price Forecast – Natural Gas Markets Find Support
- Silver Price Forecast – Silver Markets Find Support