Natural Gas Technical Analysis and Near-Term Outlook
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March natural gas tested and held the 200-day moving average around $3.07 again today and rose to test Tuesday’s $3.19 midpoint. The midpoint held on a closing basis, preventing the formation of a daily bullish piercing pattern. Today’s rise warns that a larger test of resistance might take place tomorrow but the near-term outlook continues to lean bearish.
Taking out $3.11 will call for another test of $3.07, a close below which will call for the 62 percent retracement of the rise from $2.522 at $3.00 to be challenged. Such a move would also clear the way for an eventual test of the $2.95 intermediate (1.382) target of the wave down from $3.778. Settling below $2.95 would imply the move up is complete and that a bearish reversal will continue to unfold.
Nevertheless, the intra-day wave up from $3.062 shows potential to test its $3.21 equal to (1.00) target first. Overcoming $3.21 will call for $3.26, a move above which will call for key near-term resistance and the 38 percent retracement of the decline from $3.778 at $3.34 to be challenged.
