Natural gas markets fell a bit during the trading session on Friday as we are now below the $2.20 level again. I think at this point it’s very likely that we are going to see sellers step into this marketplace and continue to push this market lower. The 50 day EMA above should continue to offer resistance, as we could go down towards the $2.00 level yet again. At this point, I continue to fade rallies as we will more than likely find plenty of reasons to sell and oversupplied markets such as natural gas. I don’t know if we can break down below the $2.00 level, but I’m sure that the market is going to try to find out rather soon.
NATGAS Video 19.08.19
Rallies at this point will have to deal with not only the 50 day EMA above but also the downtrend line that is so prominently marked on the chart. At this point I believe that we will continue to see downward pressure longer-term, as we have more than enough reasons to think that the supply will continue to be a major issue. Having said all of that, if we were to break down below the $2.00 level it would be a major breakdown and probably send this market back down to the $1.75 level, a level that we haven’t seen for ages.
Ultimately though, if we were to break above the downtrend line, that could open up the door to the $2.50 level where we will see a lot of selling pressure, and a move above there could send this market into an uptrend. I don’t expect to see that anytime soon though.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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