Small Channel Formation

Recent action has traced out a small rising parallel channel with wedge-like characteristics—potentially bearish on downside resolution. No trigger has appeared yet, but today’s peak precisely hit multiple resistance layers: the small channel top line, 175% extension of the broader rising trend channel, and 88.6% Fibonacci retracement.

Resistance Confluence Risk

This precise alignment elevates the odds of a bearish correction. Still, recognition of the 175% channel line allows for possible additional grinding higher while hugging that dynamic resistance.

Next Upside Objective

Continuation beyond current levels targets the 200% projection of the rising ABCD pattern, doubling the length of the initial AB leg for the CD advance.

Primary Support Framework

The 10-day average at $4.37—rising sharply—serves as the most reliable dynamic support. The small channel’s lower line and 150% extension of the larger channel provide secondary context, but the 10-day level will dictate the correction’s demand profile.

Weekly Trend Status

Natural gas nears completion of its fourth straight week of higher highs and higher lows, underscoring the bull trend’s persistence despite short-term extension.

Correction Imminence

Short-term overextension signals a correction of some magnitude is likely overdue, even if price sustains briefly higher. The downside risk grows, though recent bullish behavior suggests any pullback will reload for resumption.