Natural gas markets have had a positive week, although it has been rather noisy. There is a tropical depression in the Gulf of Mexico that has traders a bit cautious and started short covering. However, there are also colder temperatures coming in the United States that will of course dwindle supply, and that of course is bullish as well. With that being the case it’s very likely that this market could test the $2.40 level and try to break out to the upside.
NATGAS Video 21.10.19
If they do, then the $2.70 level would be an obvious target, that between here and there we have the 50 day EMA which is trading at the $2.60 level that could cause issues also. Ultimately, we are getting close to that time of year where the market changes trends for a couple of months so that trade is probably the most likely of them all. However, you unfortunately probably have to wait until we break above the $2.40 level to get any type of confirmation.
To the downside if we were to break down below the $2.20 level that would be very negative. It will most certainly open up the door to the $2.00 level which should be massive support based upon psychology alone. Obviously though, that’s the less likely scenario that I see as I have the line set up on the chart to show all of my targets to the upside plus my support.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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