Natural Gas Forecast: Bullish Trend Faces Key Support Test

Market Overview

Natural gas prices are currently testing a critical support level after facing rejection at $3.03. The price has recently fallen to a low of $2.86, but it managed to close above the 50-day moving average, which is currently at $2.88. This indicates that the broader bullish setup remains intact despite the recent bearish session.

Technical Analysis

Resistance and Support Levels

Natural gas has struggled to break through the resistance level near $3.03, with sellers regaining control after a slight advance to $3.01. The session saw a significant drop, but the 50-day moving average has held as support, which is crucial for maintaining the bullish outlook.

The 20-day moving average is also showing signs of improvement, currently at $2.83, and is expected to rise above the recent higher swing low, reinforcing the bullish trend. If natural gas can hold above these moving averages, it suggests that demand will remain strong.

Potential Upside Targets

During the recent decline in July, a sharp drop indicated an imbalance of orders, which often leads to gap-like behavior that can be filled later. The top of this range aligns with the 78.6% Fibonacci retracement level at $3.20, which could act as a significant resistance zone as the 200-day moving average approaches it at around $3.28.

For now, the immediate focus is on whether the 50-day moving average can continue to serve as support. If it does, the recent rejection at $3.03 may be viewed as a temporary pause in the broader bullish reversal rather than a trend change.