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Natural Gas Forecast Video for 14.08.23 by Bruce Powers
Natural gas may have reached a bottom for the current pullback. It fell below yesterday’s low earlier in the session, triggering a bearish signal, before finding support at the downtrend line (noted yesterday) and bouncing strong. Enough to return to the opening price. If the day closes at or above the 2.78 opening the candle will close green. It is not clear at the time of this writing where the close will be but the higher the price on the day’s range the better for the bulls.
Support Found at Downtrend Line, Leading to a Strong Bounce
Today’s low of 2.70 was an exact hit of the line. It is anticipated to act as support following its prior stint marking resistance. The subsequent clear rejection of price shows it acting as support. This type of behavior of price is bullish and barring a bearish signal first, a bullish signal occurs on a move above today’s high of 2.83. If today’s closing price is above today’s high a short two-day correction may have completed. It will be bullish behavior if so as it shows increasing aggressiveness of buyers in retracements. And what would be expected if there is a chance for a continue in the near-term above this week’s 3.02 trend high. It is also a classic trend growth behavior.
Also, notice that the low of the day fell briefly below the 10-Day EMA, but it is set to close back above the 10-Day line. Notice the price behavior of natural gas relative to the 10-Day EMA. Just as we see with the downtrend line, natural gas broke out above the
Weekly Chart a Concern
Although today’s price action is being considered bullish there needs to be subsequent signs of strength starting with a rally above today’s high once completed. Of some concern is the weekly chart. It is set to end below the halfway point of the week’s range. Maybe this indicates that the low will be tested again or natural gas consolidates for a little bit before making a sustained effort at exceeding trend highs. Nonetheless, a drop below this week’s low of 2.70 shows weakness. If so, natural gas may be heading to the 78.6% Fibonacci retracement around 2.67.
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