The behavior of natural gas traders, who were continuously ignoring the cooler or bearish weather announcements, just a few weeks back, resulted in keeping the price trend in favor of the bulls.
Despite increasing selling pressure, high pressure with impressive heat and highs of 90-110º F continues over the southern U.S., Texas, Oklahoma, and South West deserts, and is likely to keep the demand on the higher side as the recent weather data maintains an overall hot U.S. pattern for the next 15 days.
Selling was visible in natural gas futures during the last two trading sessions, despite an opening gap this week.
Traders are likely to continue to push futures to cross the significant resistance at $3 before this week's closing.
I would not be surprised if the futures continue to rally on an overall hot U.S. weather pattern and hold above $3.4 during the upcoming week - a U-shape recovery before this week's closing will provide the first confirmation.
In the 4-hour chart, futures are holding much above the 200 DMA after finding a breakout above this significant support on June 15, 2023, and maintaining a bullish channel despite increasing selling pressure.
A U-shape recovery is possible soon as the formations seen since morning continue to generate fresh buying as futures have found significant support at $2.648.
Moreover, a sustainable move above the immediate resistance at $2.767 will keep the trend in favor of the bulls.
Disclaimer: The author of this analysis does not have any position in Natural Gas futures. Readers should take any trade at your own risk, as Natural Gas is one of the most liquid commodities of the world.
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Natural Gas: Changing Trader Behavior Likely to Push Prices Higher
Published 29/06/2023, 08:12
Natural Gas: Changing Trader Behavior Likely to Push Prices Higher
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