In the bigger picture, natural gas remains range bound between nominally $2.60 and $2.84. However, last Friday’s break higher out of a bullish flag and test of resistance at $2.76 set prices up to test the upper end of the trading range this week. So far, though, prices have struggled to reach the upper end of the range and the last three days form stars. Two, including the most recent, are shooting stars and the third is a hanging man. All three stars are part of an evening star reversal pattern setup that would be completed by a close below $2.71.

Given the shooting stars, hanging man, evening star setup and several bearish intra-day momentum divergences near-term odds favor another test of $2.71. As stated, a close below this would complete the candlestick reversal pattern and open the way for the confirmation point near $2.68. This is key support for the near-term because it is also the 62 percent retracement of the move up from $2.621. Settling below $2.68 would open the way for another test of the bottom of the recent trading range at $2.60.

That said, trading has been erratic and so far $2.71 has held after being tested on Monday. Should prices rise above $2.78 first, look for another attempt at $2.81 and even $2.87, resistance levels split around the upper end of the range at $2.84.

This is a brief analysis for the next day or so. Our weekly Natural Gas Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key natural gas futures contracts, calendar spreads, the UNG ETF, and several electricity contracts. If you are interested in learning more, please sign up for a complimentary four-week trial.

Natural gas is still oscillating within a range between nominally $2.60 and $2.80. Traders are likely waiting on external factors to push the market out of the range, so for now, erratic trading will most likely continue.

Prices briefly fell below the lower trend line of the bullish pennant (not a textbook example) that formed during the decline from $2.764. However, the move stalled at $2.621 before rising to $2.69 and forming an intra-day double-top. Due to this pattern and the settle below Tuesday’s midpoint and the 62 percent retracement of the decline from $2.726 near-term odds favor a test of $2.64 tomorrow. This is the intra-day double top’s target and the larger than target of the wave $2.69 – 2.667 – 2.69.

A close below $2.64 would call for $2.60 and lower, though given recent choppiness it would not be surprising to see $2.64 hold and for a test of $2.72 resistance to take place. This is near the upper trend line of the pennant. A close above this would call for $2.76 and possibly higher.

So, the market will most likely test a bit lower tomorrow before possibly challenging resistance again. But, with all factors considered, there is still no evidence that the market will break out of the trading range and determine a long-term direction.

This is a brief analysis for the next day or so. Our weekly Natural Gas Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key natural gas futures contracts, calendar spreads, the UNG ETF, and several electricity contracts. If you are interested in learning more, please sign up for a complimentary four-week trial.

Natural gas continues to show signs that it has settled into a trading range between nominally $2.55 and $2.85. Trading will most likely remain erratic as the market awaits factors to push it out of the range. However, it may be awhile before such factors come forth as the market will be pressed to balance inventories that are well below the five-year average against strong production during the low demand spring shoulder months.

Quantitative factors are balanced and reflect the neutral near-term outlook. Today’s initial move lower held support at $2.67 before rising and challenging important resistance at $2.75. The subsequent pullback from $2.746 forms a long upper shadow on the daily candlestick and is poised to challenge $2.67 again tomorrow. The likelihood of a test of support was also accentuated by a confirmed bearish KaseCD divergence on the $0.015 Kase Bar chart. A close below $2.67 will call for $2.63, which connects to $2.59 and $2.56.

That said, trading will likely remain choppy and a close above $2.74 would open the way for $2.78. Settling above $2.78 would shift near-term odds in favor of challenging the top of the trading range around $2.85.

This is a brief analysis for the next day or so. Our weekly Natural Gas Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key natural gas futures contracts, calendar spreads, the UNG ETF, and several electricity contracts. If you are interested in learning more, please sign up for a complimentary four-week trial.

The long-term outlook for natural gas is negative but the May contract met and held support around its $2.60 swing low Monday. The subsequent move up is most likely corrective of a longer-term decline to challenge $2.55 and lower. Even so, there is some technical evidence that the move up could still extend to at least $2.75 before another test of $2.60 and lower takes place.

The upward correction from the $2.61 swing low stalled at $2.731 today before pulling back to $2.69. The pullback forms an intra-day bullish pennant, so there is still a good chance the upward correction will extend. However, prices will have to break higher out of the pennant tomorrow and settle above $2.75 soon if the move up is going to challenge $2.82 and eventually key resistance at $2.86.

A move below $2.67 early tomorrow would be a likely sign that the pennant has failed and that the move down will challenge the $2.60 swing low again. A close below this would call for key lower support at $2.55, which is the last level protecting the continuation chart’s $2.522 swing low.

This is a brief analysis for the next day or so. Our weekly Natural Gas Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key natural gas futures contracts, calendar spreads, the UNG ETF, and several electricity contracts. If you are interested in learning more, please sign up for a complimentary four-week trial.

Last week, April natural gas broke below the lower trend line of the upward sloping channel it had been oscillating within since February 12. Prices also settled below important support at $2.66. The move down hesitated yesterday, but resistance at $2.71 held this morning and prices fell below the $2.64 swing low today. All of this indicates that the outlook for natural gas remains negative and that major support in the mid-to-low $2.50s should be tested again soon.

Technical factors call for at least $2.62 and likely $2.59 tomorrow. There is trend line support around $2.62, and $2.59 is a confluent wave projection. Otherwise, there are no patterns or signals that indicate the move down will stall. A close below $2.59 would open the way for major support at $2.55. This is the last level protecting the continuation chart’s $2.522 swing low, a close below which would call for a much more bearish long-term outlook.

Should prices turn higher, the move up will most likely be corrective and should hold the $2.71 intra-day swing high. Key resistance for the near-term is $2.74. A sustained close above this would not doom the move down but would call for a larger upward correction before the decline continues.

This is a brief analysis for the next day or so. Our weekly Natural Gas Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key natural gas futures contracts, calendar spreads, the UNG ETF, and several electricity contracts. If you are interested in learning more, please sign up for a complimentary four-week trial.