Natural Gas Price Forecast – February 17, 2021

Natural Gas Technical Analysis and Near-Term Outlook

Natural gas rose as expected again today and has nearly fulfilled a crucial target and bullish decision point at $3.34. This is the larger than (1.618) target of the primary wave up from $2.268. It is also in line with the target of a rectangle pattern that prices broke higher out of yesterday. Normally, a pullback would be expected before overcoming the larger than target of such an important wave. However, external factors are quite extraordinary right now, so it would not be surprising to see prices overcome $3.34 during the next few days.

A sustained close above $3.34 will clear the way for $3.39, $3.45, and $3.55. However, it is important to note that given continue bullish sentiment from external factors (e.g., weather), there is potential for prices to rise to $3.99 and even $4.43. It is premature to call for such a move, but these are the XC (2.764) and trend terminus of the primary wave up from $2.268, respectively.

Natural Gas - $0.05 Kase Bar Chart
Natural Gas – $0.05 Kase Bar Chart

The daily RSI and Stochastic are overbought but can remain that way for an extended period during random events. Otherwise, there are no patterns or setups that call for the move up to stall other than the importance of resistance at $3.34. Even so, should natural gas take out $3.16 early tomorrow look for a test of key near-term support at $3.10. Settling below this would reflect a bearish shift in near-term sentiment and call for a test of $3.01 and possibly lower.

This is a brief analysis for the next day or so. Our weekly Natural Gas Commentary and daily updates are much more detailed and thorough energy price forecasts that cover key natural gas futures contracts, calendar spreads, the UNG ETF, and several electricity contracts. If you are interested in learning more, please sign up for a complimentary four-week trial.

Published by

Dean Rogers, CMT

Dean Rogers, CMT is the general manager of the Kase Call Center in Albuquerque, New Mexico. He oversees all of Kase and Company, Inc.’s operations including research and development, marketing, and client support. Dean began his career with Kase in early 2001 as a programmer but has developed into Kase’s senior technical analyst. He writes Kase’s award-winning weekly Crude Oil, Natural Gas, and Metals Commentaries. He is an instructor at Kase's classes and webinars and provides all of the necessary training and support for Kase's hedging models and trading indicators for both retail and institutional traders.

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