[ad_1]
\n<\/p>\n
Nonetheless, the rising trendline may continue to mark resistance on the way up and therefore hampers the potential of a rally. It is also important to note that this week\u2019s price action is contained within the price range from last week. Last week\u2019s high of $4.90 established a new high for the uptrend, but it was followed by sellers taking control. Subsequently, the week ended with a bearish looking relatively wide range candlestick pattern. Since sellers dominated price action last week, downward pressure may continue.<\/p>\n
Therefore, it looks like a rally may establish a lower swing low and the CD leg of a declining ABCD pattern. The first downswing from last week\u2019s high generated the AB leg of the pattern. Also, note that there is a bearish divergence with the relative strength index (RSI). That also implies continued downward pressure. That may change if the trendline on the RSI window is broken to the upside.<\/p>\n
Natural gas would first need to rise above last Wednesday\u2019s high of $4.38 and stay above it for the above bearish thesis to begin to change. That would show continued strength and show a reclaim of the January prior trend high of $4.37. If further signs of strength followed, then natural gas would have a chance to challenge and possibly exceed the recent trend high.<\/p>\n
On the downside, the 50-Day MA is critical support for the near-term angle of ascent. However, notice that the recent angle of the trend is higher than it has been. Since the $2.99 swing low from January was well below the 50-Day line, it could easily be broken again.<\/p>\n