Natural Gas Technical Analysis

The natural gas markets did very little in the early hours on Friday, and so it looks like we are just going to hang around the $2.25 region. This is a market that might be in the process of forming a little bit of a double bottom on the four hour chart, but really at this point, I think any bounce is probably more or less going to be a short term rally just waiting to happen, not necessarily some type of major turnaround. In fact, we may get that little bit of a bounce, mainly due to the fact that at least here in the northeastern part of the United States, we are going to get pretty nasty heat.

Next week it will be in the neighborhood of around 38°C. if my calculation is correct. But this is a short term thing. So, if you are nimble enough, yes, you may be able to buy it here, but I wouldn’t get married to this position. For myself, I am investing in natural gas and therefore I am through an ETF, and I don’t have any leverage. So, I’m just going to sell at the end of summer, mid fall when we really start to spike in price. It happens every year. So, it’s not exactly a very difficult trade to take, but the lack of leverage is what you desperately need because this is a market that can get thrown around quite quickly.