Natural Gas MCX – Above 114 Target 134—158, Any Panic Buy 500-100 Lots
Natural gas prices moved lower on Thursday, declining slightly more than 2% following a smaller than expected draw in natural gas inventories.
The weather is expected to be warmer than normal in the United States for the next 6-10 and 8-14 days according to the National Oceanic Atmospheric Administration. Oil prices rebounded on Thursday as oil executives in the US appear to be having conversations with Saudi Arabia on a potential global cut in oil output.
Technical Analysis
Natural gas prices moved lower on Thursday declining 2% and testing support near the continuation contract low of 1.51. Resistance on natural gas prices is seen near the 10-day moving average at 1.66. Short term momentum has turned negative as the fast stochastic generated a crossover sell signal.
The current reading on the fast stochastic is 8, well below the oversold trigger level of 20 which could foreshadow a correction. Medium-term momentum is negative as the MACD (moving average convergence divergence) histogram is printing in the red with a downward sloping trajectory which points to lower prices.
