Natural gas markets have gone back and forth during the week, showing signs of uncertainty going into the weekend. That being said though, that is probably the best thing that we have seen for the natural gas markets in ages. The $1.80 level has been supportive over the last several weeks, and it has in fact been important in the past as well. The natural gas inventory numbers have been much better this week, so that of course has helped as well. Temperatures are starting to drop a little bit in the United States, but ultimately the weather has come a bit too late to make any major difference in this market. Because of this, any rally that spikes in the short term should be a selling opportunity.
That being said, if the market does break down below the $1.80 level, then we could drop down to the $1.60 level underneath. The market is most certainly in a downtrend, and let’s be honest here, there is far too much in the way of supply to think that this market is going to change anytime soon. However, there are a slew of bankruptcies coming in the United States that will drive down supply, and quite frankly that’s probably the only thing that will save this market. However, that’s a story for later this year and therefore in the short term it looks like the market is to be sold every time it bounces. Of particular note is the fact that the $0.20 levels in this market continues to consistently offer supply and demand.
This article was originally posted on FX Empire
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