The natural gas markets initially tried to rally during the week but turned around to form an ugly shooting star shaped candle in the middle of the range. You can see that the range is marked at the $2.70 level underneath, and the $3.00 level above. A market move down towards the $2.70 level will be very interesting to me, because it has offered so much in the way of support as of late. While the candle stick for the week is very ugly, the reality is that the support and the resistance that has been guiding this market has been around forever.
I think longer-term traders will start to look towards the cold months rather soon, and therefore once we roll over to the next contract we will be thinking about snow in the northeastern part of the United States. That’s obviously a very negative turn of events for weather, and it very positive for the demand of natural gas. At this point, I think that we are low enough that selling isn’t much of a thought. Overall, I think that if you are patient enough you should get a candle that you can buy, perhaps on the daily chart instead of the weekly chart. You can fine-tune your entry by doing that, and I would be all over some type of bounce from the $2.70 level as it has a good risk to reward ratio.
NATGAS Video 17.09.18
This article was originally posted on FX Empire
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