Natural gas markets have been slightly negative for the week, as we continue to drift a bit lower. At this point, it’s very unlikely that we will have huge moves, but it does appear that we are seeing a bit of a grind lower overall. I think that we will retest the $2.00 level underneath, which attracts a lot of attention due to the psychological importance. One would think that there are a ton of stop loss orders right around that area as well, so I think somebody out there is going to try to break through those barriers and go lower. If they do we could have a bit of a “flush” down to the $1.75 level after that. All things being equal though, I think that the market will probably find the $2.00 level a bit difficult to break through.
NATGAS Video 26.08.19
I think at this point we are probably looking at selling the rallies as natural gas continues to be oversupplied. However, we are getting closer to the colder temperatures coming to the northern hemisphere, which should drive up demand and caused the cyclical spike that we see quite often. The 50 day EMA above marked in red is massive resistance so I think any rally towards that area will continue to find sellers jumping into the market. One thing is for sure, the downside still works but we are getting closer to the cyclical bounce. At this point I think short-term day trading to the downside probably continues.
This article was originally posted on FX Empire
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