Natural gas markets rallied significantly during the trading session on Monday, breaking above the $1.80 level quite handily. At this point, the market then pulled back a bit, but I think we still have a lot of support underneath and I do think that the hot temperatures in the United States should continue to push natural gas higher, at least in the short term. Ultimately, the market is likely to go looking towards the $2.00 level, which we also see the 200 day EMA sitting there. At this point in time, the market is likely to see quite a bit of selling pressure.
NATGAS Video 07.07.20
I think at this point, the market then probably continues to see a lot of back and forth so keep in mind that we are probably trying to stay within a $0.50 range right now, between the $2.00 level at the top and the $1.50 level at the bottom. We have been in a downtrend for some time, but at this point in time I do think that we need to look at the $1.50 level as important based upon longer-term charts, and therefore I begin to question whether or not we have just formed a “double bottom”? With this, I think that you can find value on short-term dips, at least in the meantime. If we were to turn around a break down below the $1.50 level that would be catastrophic for natural gas.
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