Natural Gas Clocks Three-Year Low
Monthly Support Eyed
Recent trading has seen the price of natural gas futures refresh multi-year lows at 1.927 USD/MMBtu. Since November 2023, we have seen natural gas trade lower by nearly -50% and demonstrate scope to reach support at 1.615 USD/MMBtu, a level that boasts historical significance as far back as 1999!
Given this, there is room for further downside in this market.
Daily Chart Echoes Bearish Vibe
Moving across the page to the daily timeframe, you may note that the downside vibe is emphasised in this chart.
Not only has the unit ventured south of channel support taken from the low of 2.235 USD/MMBtu, but we’ve also seen support taken out at 1.992 USD/MMBtu (now marked resistance). Support can be found at 1.792 USD/MMBtu, derived from 2020. Usually, a break of support will see traders seek a retest of the breached level as resistance. This has already occurred; if you drill down to the H1 timeframe, you will note that the price has actually retested the level in the shape of an ‘alternate’ AB=CD bearish pattern and has driven lower in a one-sided move.
With room seen to continue lower on both monthly and daily charts, further underperformance could be on the way, targeting daily support from 1.792 USD/MMBtu, followed by a test of monthly support at 1.615 USD/MMBtu.
Recent trading has seen the price of natural gas futures refresh multi-year lows at 1.927 USD/MMBtu. Since November 2023, we have seen natural gas trade lower by nearly -50% and demonstrate scope to reach support at 1.615 USD/MMBtu, a level that boasts historical significance as far back as 1999!
Given this, there is room for further downside in this market.
Daily Chart Echoes Bearish Vibe
Moving across the page to the daily timeframe, you may note that the downside vibe is emphasised in this chart.
Not only has the unit ventured south of channel support taken from the low of 2.235 USD/MMBtu, but we’ve also seen support taken out at 1.992 USD/MMBtu (now marked resistance). Support can be found at 1.792 USD/MMBtu, derived from 2020. Usually, a break of support will see traders seek a retest of the breached level as resistance. This has already occurred; if you drill down to the H1 timeframe, you will note that the price has actually retested the level in the shape of an ‘alternate’ AB=CD bearish pattern and has driven lower in a one-sided move.
With room seen to continue lower on both monthly and daily charts, further underperformance could be on the way, targeting daily support from 1.792 USD/MMBtu, followed by a test of monthly support at 1.615 USD/MMBtu.
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