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The selling since the end of January has been rather unrelenting. And that saw natural gas prices sink to a 3½-year low at one point earlier this week. A much warmer winter has been all the rage and the shutting down of the Freeport terminal in Texas at the end of last month did not help either.

Natural gas futures (March) weekly chart

But as we near the lowest levels since 2020, are we starting to see a correction to the squeeze lower in natural gas prices? That is certainly a consideration when you look at price action today.

Natural gas futures (March) hourly chart

All through February, the near-term chart shows that sellers are well in control in driving prices lower. The bias stayed more bearish with any minor rallies being sold rather quickly. That is until we saw the spike higher today, which not only took out the 100-hour moving average (purple line) but is also now contesting a break of the 200-day moving average (green line).

Purely from a technical standpoint, that could give some room to work with for buyers – at least in the near-term. A sudden shift in the bias could lead to a squeeze higher before traders reevaluate the situation once again.

Besides that, do keep in mind that we will see the March futures contract roll over into the April futures contract (which are trading higher) later this week. So, that does add some trickiness in reading the price action ahead of the end of the month.

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