Category: Forex News, News

Natural Gas Price Forecast: Remains Bearish as Resistance Holds Strong

Confluence of Indicators Point to 2.23 and Lower

There is a confluence of price levels that appear from around 2.23 to 2.17. That is not too much lower than the current retracement low of 2.27. The range provides a potential support area given the confluence of indicators pointing to the price range. Two key levels include the 61.8% Fibonacci retracement at 2.18 and the completion of a falling ABCD pattern at 2.20. Each method is looking to identify a harmonic price level associated with prior swings highs and lows. The target from the ABCD pattern is an extended target using the 127.2% Fibonacci ratio.

Bullish Sentiment Begins to Dominate Above 2.46

An alternative to the bearish scenario unfolds with a rally above Tuesday’s high of 2.45, along with the 200-Day MA at 2.46. An earlier initial indication of strength would be seen in a rally above today’s high of 2.385. However, an advance above 2.385 puts the price of natural gas heading back up into potential resistance around the 200-Day line. And resistance may be seen again.

Once the 200-Day line is exceeded, a potentially significant near-term barrier to a continuation higher is resolved. It would set the stage for a rally up to the 50-Day MA at 2.55 and the 38.2% Fibonacci retracement at 2.61. A little higher will be a price range from around 2.67 to 2.71. That range consists of the 20-Day MA and 50% retracement, respectively.

20-Week MA Further Confirms Support Zone

Regarding the next lower potential support zone, in addition to four price levels that identify the price range there is also confirmation of the range on the higher time frame weekly chart. The 20-Week MA is present on the weekly chart (not shown) at 2.19. Also, the 50-Week MA is a close match with potential resistance around the 200-Day line. It shows potential resistance at 2.49.

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