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Natural Gas Weekly Forecast: Buyers Shy Away From Key Resistance Levels

Natural Gas Weekly Forecast: Buyers Shy Away From Key Resistance Levels

2019-10-21 14:00:00
Mahmoud Alkudsi, Market Analyst
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Natural Gas Technical Analysis

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Natural Gas – Weak Buyers

On Sep 26, natural gas started a downtrend move then on Oct 3 the price printed $2.258- its lowest level in over five weeks. However, sellers showed hesitation after, allowing buyers last week to take charge and rally the price. On Friday, natural gas closed with nearly 6.5% gain.

Today, the relative Strength Index (RSI)declined then crossed below 50 highlighting the end of buyer’s dominance .

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Nat-Gas DAILY Price CHART (Jan 15, 2018 – Oct 21, 2019) Zoomed Out

Natural Gas price daily chart -21-10-19 zoomed out

Nat-Gas DAILY Price CHART (SEp 13, 2018 – Oct 21, 2019) Zoomed IN

Natural Gas price daily chart -21-10-19 zoomed in

Looking at the daily chart, we notice at the start of last week's session natural gas gaped to the upside moving to a higher trading zone $2.340 - $2.490. This week, the price opened with a downward gap and remained in the same trading zone.

Thus, a close below the low end of the zone could send the price towards $2.210. Further close below the low end, could cause more decline towards $2.124. Although, the weekly support levels underlined on the chart (zoomed in) should be kept in focus.

On the other hand, any failure in closing below the low end could reverse the price’s direction sending it towards the high end of the zone. Further close above the high end could mean more bullishness towards $2.552. That said, the weekly resistance level marked on the chart would be worth monitoring.

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Natural Gas price Four-Hour PRICE CHART (Sep 17 – Oct 21, 2019)

Natural Gas price four hour chart -21-10-19

From the four- hour chart, we notice on Oct 11 natural gas corrected higher creating a higher low at $2.282. The price rallied after, then on Oct 16 created a higher high at $2.495.

Today, natural gas declined eyeing a test of Oct 14 low at 2.358. Further decline below $2.282 could entice sellers to press the price towards $2.210. Although, the weekly support level underlined on the chart should be considered.

On the flip- side, any break above the Oct 16 high could resume bullish price action towards $2.552. Nevertheless, the weekly resistance level underscored on the chart should be watched closely.

See the chart to know more about key levels to monitor in a further bullish/bearish move.

Written By: Mahmoud Alkudsi

Please feel free to contact me on Twitter: @Malkudsi

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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