Natural Gas forecast for the week of July 14, 2014, Technical Analysis

Natural Gas forecast for the week of July 14, 2014, Technical Analysis

Get Forex buy/sell signals directly to your email and by SMS.

To learn more click here

The natural gas markets fell rather drastically during the course of the previous week as we broke down below the $4.30 handle finally. This was significant support for the consolidation that we had seen most of the year, and the fact that we broke below there does in fact tell us that the sellers are starting to take control again. Let us not forget, natural gas markets were a massive bear market for quite some time before all of this.

We stopped at the $4.10 handle, and we would of course suspect that the $4.00 handle would offer a bit of support as well. After all, it is about as big of a round number as you can get, but ultimately it has been sliced through several times, so the support will probably only be there the first attempt. On the other hand, the resistance that should be seen it before $.30 handle should be fresh, and therefore be very strong. We would be interested in selling resistive candles near that level, as it should confirm the breaking down of this market.

With the situation in the Crimea settling down a bit, at least as far as the Russians are concerned, that should in fact alleviate fear as far as supply in the European Union. That was one of the main drivers of price higher our opinion, and now that it’s starting to go where it makes sense that the market would fall. Also, the northeastern United States is in summertime now, and that of course creates a drag on demand, a fundamental driver to say the least.

If we can get below the $4.00 handle, we don’t see any reason whatsoever why this market should fall back down to the $3.60 level. In fact, we would be surprise at all to see the $3.00 handle given enough time. If you keep in mind that there is over 14,000,000,000,000 ft.³ of proven reserves in the United States alone. In other words, natural gas is there for the taking and therefore supply should never be more than temporarily stymied.

 

More here: 

Natural Gas forecast for the week of July 14, 2014, Technical Analysis

See which stocks are being affected by Social Media

Share this post