The Natural Gas market has fallen a bit during the trading session here on Tuesday as the 50-day EMA continues to be a massive barrier.
If we do break above there, then we could send this market towards the $3 level, but all things being equal, I think it takes quite a bit of momentum to make that happen.
With that being the case, I believe that most traders will be looking at the Natural gas as a market that you continue to sell anytime you get an opportunity. After all, this is what is known as shoulder season and that of course is the time of year where traders price in the idea of a huge lack of demand. After all, nobody's really that worried about heating their homes or anything like that.
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So, with that being the case, it is a market that will continue to look at each rally as a potential shorting opportunity with the $3 level being a massive ceiling. If we can break above there, then it's possible that we could go looking at the $3.30 level, but I think something pretty spectacular would have to happen. In fact, we've already seen some pushbacks during the day on Tuesday.
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I believe that this market could go looking to the $2.60 region, but it's going to be a grind. Higher interest rates are an effect on most markets, but here in Natural Gas I don't think so just because there's so much of it.
With that, anytime this market rallies at the first signs of exhaustion I'm more than willing to start selling. It's just not a market that lends itself to being very strong anytime soon. With that, I still believe that the $3 level is your ceiling and it's probably not for a few months where we see air conditioning demand come into the picture that we see Natural Gas rise.
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