- NATGAS vulnerable to near-term pullback- constructive above 3.23
- Updated targets & invalidation levels
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Technical Outlook: NATGAS broke above channel resistance this week with the rally through the monthly opening range highs / 50% retracement shifting the focus higher. The advance is now targeting a near-term resistance confluence around 3.35 where the 61.8% retracement of the December decline converges on the median-line slope of the ascending pitchfork formation extending off the yearly low. The immediate topside bias is vulnerable below this level but the trade remains constructive while above 3.23.
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Notes:A closer look at price action further highlights this resistance region. Look for initial support at 3.30 with our focus higher while above 3.23. A break below the monthly open at 3.18 would be needed to shift the broader focus back to the short-side (broader bullish invalidation).
From a trading standpoint, we’ll be looking to fade weakness while within this formation with a topside breach targeting the upper parallel (red) backed by a key Fibonacci resistance range at 3.50/55.
Other Setups in Play:
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- GBP/USD: Rally Under Review- Bank of England Super Thursday on Deck
- NZD/USD: Vulnerable Ahead of RBNZ – Range Break in Focus
- Written by Michael Boutros, Currency Strategist with DailyFX