Confirmation from Moving Averages and AVWAP

Thursday’s close above the 20-Day moving average at $2.89 gave a clear signal of improving momentum. Natural gas also reclaimed the anchored volume-weighted average price (AVWAP) near $2.96, which had been an important reference level. Yesterday’s $2.99 close confirmed this breakout, while prior resistance at $2.97 has shifted to support. A second consecutive close above the AVWAP today would strengthen the bullish case.

Long-Term AVWAP Recovered

The long-term AVWAP, drawn from the 2024 trend low, had acted as dynamic support for much of the year before breaking down in August. Its recovery this week signals buyers are regaining control of the longer-term trend. That development improves the probability of a sustained move higher and shifts market tone toward accumulation rather than distribution.

Channel Structure Supports Further Gains

Price action has also respected the structure of a large descending parallel channel. The channel’s midpoint was reclaimed yesterday, with today’s low bouncing from support near $2.92. Earlier, the August swing low at $2.62 reversed higher from the 78% retracement of the channel, confirming recognition of the structure. This behavior strengthens the outlook for further gains while keeping the broader channel pattern intact.

Upside Targets in Focus

Once price reverses from the lower side of a channel, the opposite side often becomes the next logical target. For natural gas, that points to an upside zone at $3.15–$3.19, which also matches measured objectives from the wedge breakout. Adding weight to this level, the 50-Day moving average has now aligned at $3.18, making it a key resistance area to monitor. A decisive breakout would open further upside potential, while hesitation here could lead to consolidation or weakness.

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