Natural gas markets drift lower during Monday session

Natural gas markets initially fell during the day on Monday, reaching down towards the $2.80 level, but then rally to the $2.84 level before falling again. It looks as if we are trying to roll over again, showing signs of negativity. We are in and uptrend recently though, and a bit of an up-trending channel. If we break down below the $2.78 level, we will more than likely unwind down to the $2.73 level, and perhaps even lower than that. Ultimately, I think this is a market that will see a lot of selling pressure, but recently we have seen buyers command based upon hotter temperatures in the United States driving up demand.

Ultimately, this is a market that I think will eventually reach to the $2.68 level again, but it’s not until we break down to a fresh, new low on the hourly chart that I’m willing to bank on that type of move. I think that we could see a lot of volatility over the next 24 hours, so it’s not necessarily a bad idea to stand on the sidelines. To the upside, the $2.86 level offers a bit of resistance, but I think if we break above that level we will more than likely go to the $2.90 level, perhaps even the $3.00 level which I see as the complete ceiling. If we break down below the $2.68 level, the market will unwind rather drastically. However, neither of these are going to happen in the short term.

NATGAS Video 22.05.18

This article was originally posted on FX Empire

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