Natural Gas Technical Analysis and Near-Term Outlook
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Natural gas took out the $2.746 swing low and invalidated all the prior waves up from $2.592 that had called for a continued rise. The 62 percent retracement of the rise from $2.592 at $2.70 and the $2.69 smaller than (0.618) target of the wave down from $2.905 held on a closing basis. Another test of $2.69 is favored, a close below which will imply that the corrective move up from $2.592 is complete. This will open the way for the $2.66 smaller than (0.618) target of the wave down from $2.868. This wave connects to $2.58 as the equal to (1.00) target. This is also the equal to target of the wave down from $2.905. Therefore, settling below $2.69 and then $2.66 will clear the way for a move below the confluent $2.62 target that was tested and held on a closing basis when prices fell to $2.592.
Nevertheless, because $2.69 held on a closing basis, there is still a modest chance for a continued rise. However, prices would have to close above $2.81 to put the near-term odds in favor of testing the $2.870 smaller than (0.618) target of the new primary wave up from $2.592. Settling above $2.87 will call for a test of this wave’s $2.98 equal to target.
