Natural Gas Likely to Reach Turning Point Soon
Satendra Singh | Jan 10, 2023 08:25AM ET
Natural gas' price-action in the 15-minute time frame indicates that a renewed optimism is developing among the bulls since the gap-up opening this week.
The prices reversed sharply on Friday from the recent low at $3.520 and closed last week at $3.674 as Thursday’s inventory showed a withdrawal of more than 200 Bcf.
On Monday, the prices rallied amid changing weather announcements and a short-squeeze from the long-time low deep inside an oversold territory, hitting $4.123.
This sudden surge attracted bears to load shorts from the day’s high.
A sudden reversal could start on Tuesday at 08:30 ET (13:30 GMT) as the prices are still sustaining above the 26-Day Moving Average (DMA) in the 15-minute time frame, and the 9 DMA has crossed above the 26 DMA, forming a bullish crossover.
Immediate resistance is at $4.111, and the second resistance will be at $4.348. And on the lower side, immediate support is at 9 DMA, and the second significant support will be at 200 DMA.
The wild price swings will continue as natural gas futures are about to complete a base formation at this level before moving above $4.585.
A sustainable move above $4.258 in today’s trading session will be the first indication of the big bulls’ entry into the scenario.
Disclaimer: The author of this analysis does not have any position in Natural Gas futures. Readers are advised to take any position at their own risk, as Natural Gas is one of the most liquid commodities in the world.
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