Natural Gas Forecast 17/09: Price Stabilizes Near $3 (Video)

(MENAFN- Daily Forex)

• The natural gas markets have gone back and forth.
• They're in the trading session here on Tuesday as we continue to see a lot of volatility out there near the 50 day EMA and perhaps just as importantly, if not more importantly, the $3 level on Tuesday, we initially fell pretty significantly to reach the $2.87 level before snapping back to the upside.
• We are a couple of weeks from rolling over into the November contract. So, we are getting close to that time of year where natural gas becomes very bullish. After all, the markets will continue to look at heating demand or the lack of as a major detriment to natural gas.

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And of course, we haven't seen much in the way of extreme heat in the United States for a while. So that drives down the need for electricity. Another thing that you need to keep in mind, though, is if the US economy does roll over, it will drive down the need for electricity anyway. So that might put a little bit of a damper on natural gas this winter. But on the whole, natural gas does fairly well in winter contracts. And like I said, we're about 10-ish days or so from rolling over into the November contract. So, you should start to see it perk up a bit. It would not be a surprise to see one more dip right here. And then I think at that point we might be done. We'll just have to wait and see. That could have been the beginning of the Tuesday session. Maybe that was it. Volume is basically normal. There's nothing erratic about volume.

So, I think this is a very dangerous market at the moment, but I am starting to think to the upside. Basically, I've gone from bearish to neutral, knowing that I'll be bullish here in a few weeks, regardless. So good price action for the day if you're bullish. The 200 day EMA above could be the signal if we break above it, that it's time to get a little bit more aggressive to the upside. If we do break down from here, there is a gap right around $2.75 that could be a target.

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