This wasn’t the best way to start the week as the natural gas markets gapped lower on Monday, reaching down towards the $2.85 level. At the moment major support can be found at $2.75, so this gap wouldn’t go any further, staying limited in the short term.
Selling opportunities could be presented if the market shows signs of the rally due to resistance being above at various levels, including $3.00 level, the 20 days and 50 days EMA.
The market can see a rally to produce more than likely in some type of exhaustive candle and possibly start selling, breaking below the $2.75 level could give plenty of momentum to break down through.
In the meantime, volatility would surely continue to be a major issue, mostly due to oversupply being a natural gas could be presented as a longer-term bearish pressure on the market.
Breaking below the $2.75 level, it could show some extraordinarily negative signs, but it is difficult to see that at the moment. Although, if it happens, then it would be time to start looking towards the $2.50 level after that, attracting a lot of attention.
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