Natural Gas Forecast January 5th, 2012, Technical Analysis

The natural gas markets bounced on Wednesday as the colder weather in the northeast section of the United States led speculators to think that the demand must be picking up. While this is almost certainly true, the inventory report today will more than likely show a drawdown of about 84 BCF, which is far below the historic norm. The winter has simply been too warm for most of this year to burn through the supply. Besides, there is far more natural gas than demand anyway, regardless of weather. The bounce looks strong, but the reality is that rallies are to be sold on weakness. We are looking for that weakness starting at the $3.20 level, and will sell the market on shorter time frames as candles show weakness.

Natural Gas Forecast January 5th, 2012, Technical Analysis
Natural Gas Forecast January 5th, 2012, Technical Analysis

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