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Natural Gas Critical Levels and Thresholds - N Gas Price Technical Forecast

Natural Gas Critical Levels and Thresholds - N Gas Price Technical Forecast

2019-11-21 15:00:00
Mahmoud Alkudsi, Analyst
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Natural Gas Technical Analysis

Did we get it right with our Gold and Crude Oil forecasts? Find out more for free from Q4 main currencies and commodities forecasts

Natural Gas – End of Uptrend Move

On Nov 5, natural gas rallied to $2.922 – its highest level in nearly ten months. However, last week the price corrected lower and created lower high at $2.762. On Friday, natural gas closed the weekly candlestick in the red with a 3.5% loss.

This week, the relative Strength Index (RSI) dipped below 50 highlighting the end of uptrend momentum.

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

Natural Gas Daily price chart 21-11-19 Zoomed out

Nat-Gas DAILY Price CHART (Aug 27 – Nov 21, 2019) Zoomed IN

Natural Gas Daily price chart 21-11-19 Zoomed in

Looking at the daily chart, we notice on Monday natural gas extended its losses as discussed in our last update and declined to a lower trading zone $2.556- $2.650. On the following day, the price rebounded nearby the low end of the zone then rallied eying a test of the high end of it.

Hence, a close above the high end of the zone could convince more buyers to join the rally. This may send natural gas towards the vicinity of $2.725-37. Further close above this threshold could cause more bullishness towards $2.799. In that scenario, the weekly resistance levels underlined on the chart should be considered.

That said, any close below the low end of the zone, could cause more sellers to join the selloff. This might press natural gas towards the vicinity of $2.490-82. Further close below this area could mean more bearishness towards the vicinity of $2.349-40. Yet, the weekly support levels underscored on the chart should be monitored.

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Natural Gas price Four-Hour PRICE CHART (Oct 11 – Nov 21, 2019)

Natural Gas Four Hour price chart 21-11-19

From the four- hour chart, we notice last week natural gas opened with a break away gap to the downside, then in the following week the price opened with a runaway gap reflecting the bearish outlook of the market. Today, the price tested the lower uptrend line originated from Oct 24 Low at $2.398.

Thus, a break below $2.473 could send the price towards $2.387. Although, a close attention should be paid to the weekly support level marked on the chart. On the flip side, a break above $2.678 could lead the price towards $2.737. Nevertheless, the weekly resistance level underlined on the chart should be kept in focus.

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

Join Me on Friday, Nov 22 at 14:00 GMT. In this session we will talk about most common

Continuation patterns and how to trade them.

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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