Natural gas markets fell slightly during the trading session on Tuesday as traders continue to look at this market as being very bearish, due to the oversupply of natural gas, as Americans have drilled 17% more this past year than they did the previous one. That being the case, there is far too much supply to get through rather easily and I think we are more than likely going to continue to see natural gas struggle until we get some type of massive cold storm in the United States. Until then, rallies would be looked at with major suspicion and therefore I think at this point it’s probably best looked upon as a market that you should be selling on short-term rallies the show signs of exhaustion. Eventually, we will probably get some type of massive spike higher, but even then, I think it’s only gotten a kickoff more selling. Quite frankly, this winter has been a complete disaster for natural gas producers and for that matter anybody has been remotely bullish.
NATGAS Video 02.01.19
I suspect that the 50 day EMA above is going to be resistive, as the $2.40 level is an area that we have seen action at previously anyway. That being said, the 200 day EMA is closer to the $2.50 level which obviously will attract a lot of attention also. To the downside, I think the market will find plenty of buyers near the $2.00 level, which is an area that is a large, round, psychologically significant figure and therefore should be respected.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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