Natural gas markets fell rather hard during the trading session on Friday, reaching down towards the 200 day EMA. That’s an area that of course has a lot of technical importance at times, but as you can see when you zoom out, the chart is clearly consolidating over the longer-term, but you need to pick out the best trades and obvious areas to get involved.
NATGAS Video 25.03.19
Looking at the chart, I believe that the $2.60 level will be the beginning of significant support, extending down to the $2.50 level. If we were to break down below the $2.50 level, that would be an extraordinarily bearish sign. However, I suspect it’s going to be very difficult to imagine a scenario where that happens. If we did though, we would probably go down to the $2.25 level. On the other side, the market has significant resistance at the $2.90 level, extending to the $3.00 level. That is an area that could offer quite a bit of selling.
In the meantime, we are simply in the middle of the range, and I think that will continue to be something that we should pay attention to, and not get involved. Simply selling at the highs and buying at the Lowes has worked for some time, so of course that’s the best way to trade this market. As we are in the middle, I’m on the sidelines and waiting for an opportunity to get involved again.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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