Drop Below Today’s Low Points to Lower Prices

A decisive decline below today’s low points to a deeper pullback. The most recent trend high price range of 2.67 to 2.65 marks the first potential support zone. It is followed by the 50% retracement of the most recent upswing at 2.55. The lower 61.8% Fibonacci retracement at 2.48 can be watched along with this week’s low at 2.46 and a prior interim swing high at 2.44. Together, they generate a potential support zone from 2.48 to 2.44.

Remains Within Large Symmetrical Triangle

Following a retracement and bullish reversal natural gas may have a chance to test the top trendline and possibly breakout through it. Otherwise, natural gas may continue to trade range bound within a relatively large developing symmetrical triangle. The bottom line of the triangle was tightened recently following the late-August higher swing low. That swing low marks a new and higher trendline for the bottom of a triangle.

Key Support at 20-Day MA

Keep an eye on the internal uptrend line marking support of the most recent trend. The 20-Day MA has recently converged with the line. This is the markets way of telling us to pay attention to the line. Of course, the 20-Day MA also has significance as it shows the near-term trend strengthening. Also, the 50-Day MA has started confirming strength as it began to turn back up earlier this week.

Natural gas has been flirting with the 200-Day MA around a year ago. Each rally above the 200-Day line has gone only so far before the price of natural gas is pulled back to the line. The same thing may happen now. However, notice that the 200-Day line is now flat and that happens before a turn up.

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