Natural gas markets have pulled back a bit during the course of the trading session on Wednesday to reach down towards the 50 day EMA. The 50 day EMA of course is an area that attracts a lot of attention, as it is a trend defining indicator. All things been equal, the market falling should not be a huge surprise, due to the fact that we are heading towards springtime in America, and that means warmer temperatures. That being said, the market has also had to deal with colder than usual temperatures as of late, so that means that we could have a little bit more demand in the short term. In fact, I suspect that is what the last couple of weeks have been about.
NATGAS Video 22.04.21
Natural gas markets will more than likely go looking towards the 200 day EMA underneath, which of course is a longer-term trend indicator that people pay close attention to. If so, then I think what we are seeing here is the possibility of the cyclical breakdown that we get every year, as temperatures rising breaks down the idea of global demand. I do think that eventually we get this move, and therefore I am willing to sell on a breakdown below the bottom of the candlestick for the trading session and have no interest in buying. I recently stated that somewhere near the $2.80 level at that there was a significant amount of resistance, but we have not even been able to seriously test that area. I still believe in that, so therefore I remain skeptical and bearish when it comes to the natural gas markets.
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