The natural gas markets gapped lower to kick off the week, and then broke down below the $3.00 level. By doing so, we entered a very bearish phase of the selloff, but by the end of the week we had started to see a bit of resiliency. At this point in time, I think that the market will probably try to rally from here and go looking towards the top of the gap, closer to the $3.30 level. Natural gas had gotten way ahead of itself. However, now it looks as if it had gotten ahead of itself to the downside as well. Overall, I think that a short-term bounce is coming but it should present itself as a nice selling opportunity. The huge moves are over, and therefore it’s likely that it will be difficult to deal with this market from a weekly standpoint. I believe that we are going to go back and forth in a relatively tight range, but I certainly feel much better in the selling side than the buying side.
NATGAS Video 07.01.19
I believe at this point the $3.50 level is going to be a bit of a “ceiling”, and therefore you should pay attention to it. If we rally towards that area and show signs of exhaustion, that is a clear selling signal. If we show signs of exhaustion at the top of the gap, that’s a nice selling opportunity as well. The alternate scenario is that we break down below the hammer for the week, but that seems very unlikely.
This article was originally posted on FX Empire
More From FXEMPIRE:
- Crude Oil Price Forecast – crude oil markets run into resistance
- USD/JPY Weekly Price Forecast – US dollar has wild ride against the Yen
- Silver Price Forecast – Silver markets choppy after jobs figures
- GBP/USD Weekly Price Forecast – British pound has wild ride for the week
- GBP/JPY Weekly Price Forecast – British pound breaks down during the week only to rebound again
- Upbeat Job and Wage Growth Underscores US Economic Strength