Natural Gas Price Forecast: Bullish Reversal Tests 200-Day Resistance

Author: Bruce Powers

Published: January 7, 2026

Overview

The article discusses the recent performance of natural gas prices, highlighting early signs of a bullish reversal following a significant correction. The focus is on the critical 200-day moving average, which serves as a key resistance level that needs to be reclaimed to confirm a sustainable recovery in prices.

Key Points

• Demand Improvement: Natural gas demand showed signs of improvement with a two-day bullish reversal, reaching a high of $3.59. A daily close above previous highs of $3.50 and $3.53 is necessary to confirm this short-term reversal.
• 200-Day Average: The 200-day moving average, currently at $3.56, is a significant resistance level. A rally above this level, confirmed by a daily close, would indicate a potential recovery.
• Support Levels: Support was identified at $3.32, which is the lower boundary of a rising channel. If this support fails, lower targets at $3.26 to $3.24 may be tested, corresponding to Fibonacci retracement levels.
• Counter-Trend Rally Potential: The article suggests that if the 200-day average is reclaimed, a counter-trend rally could occur, with initial targets at $3.80 and $3.88.
• Historical Context: The current price drop of $2.18 (39.6%) from the 2025 peak of $5.50 aligns with previous corrections, indicating that a bottom may be near.

Conclusion

The analysis indicates that natural gas prices are at a critical juncture. The potential for a bullish reversal hinges on reclaiming the 200-day moving average, with significant implications for future price movements. Traders should monitor these levels closely to gauge market sentiment and potential recovery patterns.

About the Author

Bruce Powers is a seasoned finance professional with over 20 years of experience in financial markets. He holds an MBA and is a CMT® charter holder, having served as head of trading strategy at hedge funds and as a corporate advisor for trading firms.