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Natural Gas Weekly Price Forecast – Natural Gas Recovers After Initial Selloff

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·2-min read
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Natural gas markets have gapped lower at the open on Monday, and then plunged quite a bit. That being said, we have turned around to form a bit of a hammer. This sets up an interesting set up, due to the fact that we have a couple of shooting stars, a slightly negative candlestick, and then a hammer. It appears that the market is hanging about the $5.50 level more than anything else, so I think it is worth paying attention to this region.

NATGAS Video 25.10.21

When you look at this chart, it does suggest that there is going to be a massive fight in this general vicinity, so I think we are looking at a bit of consolidation more than anything else. I also wonder whether or not we can continue to go much higher, because quite frankly one thing that a lot of retail traders do not pay attention to is the fact that Henry Hub Natural Gas is about North America, and not the European Union.

If we were to break down below the bottom of the hammer, then it could signify a move much lower. At that point in time, the market could drop towards the $4.50 level, and then possibly the $4.00 level. That obviously would be a huge shift in momentum and would catch a lot of people off guard. At this point though, it looks to me like we still have a lot of digesting to do after that massive move to the upside. All things been equal, I think you need to be very cautious with your position size.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire

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