Natural Gas - EIA Natgas Storage ReportAfter Friday's drop I started to analyze Natural Gas with watching the fundamentals much closer. Cycles alone are simply not enough for predicting future price in this volatile commodity.
Earlier this year I posted this idea :
I still think that we printed the 3 year cycle low back in August.I updated a bit the idea chart - as I was early when I was waiting for the bottom in May:
Techincals:
After Friday's massacre price dropped enough to break the trendline, but at the end of the day we stayed in the rising channel. Monday price bounced and Tuesday we had a massive short squeeze as price broke through the 50 SMA and tagged the 200 SMA. The day finished well below the 200 SMA - and the 50 SMA too - but bears tasted a bit how overcrowded the short side and this is not a one way street.
In the previous idea I was calling an early DCL on the 11th October:
but now it's clear it was only a half cycle low and we are back to the stretched daily cycles which are 75-85 days long.
The trendline break is quite normal at the daily cycle low just as the Bollinger Band crash signal and the 6 day RSI in the oversold territory.
So after the Aug.2. intermediate cycle low we have a DCL in place last Friday:
Who trusts in cycles - I do - knows that after the first DCL there is a good chance that the next daily cycle will right translate with a higher high above the November high.
So cycle wise I'm still expecting a daily cycle top somewhere above 2.8$.
And here comes the the advance of cycles vs to the fundamental traders.
Fundamental traders are still expecting 2.5-2.6 maximum on this bounce , but I don't want to lose the possibility of a 1$ bounce because of the mild winter forecasts and global warming. I 've seen NatGas dropping on hard winters and we might see it bouncing on a mild winter where sudden arctic blasts are painting the picture and confusing the forecasts.
Fundamentals:
I'm closely monitoring the near-term computer model outlook. This will be the main driver of NatGas prices in the following days.The drop on Tuesday fundamentally was driven by the December 10-15 forecast of an arctic outbreak. I'm following 2 models: GFS Ensemble model and the ECMWF ensemble model. There is an interesting divergence between the 2 models. While both model is forecasting a colder than normal mid December weather, the GFS coming in much colder than the ECMWF. GFS is showing blasts of arctic air after the the 13 of December causing significantly below normal temperatures.
So fundamentally we have both doors open to break up or break down in the following weeks , but if I'm watching the cycles and fundamentals together - knowing how overcrowded the short side in this market - I'm convinced that the surprises will move this market to or above 3$ in the following 2 months.
Today's report is coming out at 10:30 EST, the forecast is -22B.
NATURAL GAS
NATGASUSD -AnalysisNATGASUSD is highly oversold on every single chart except the daily (M30, 1H, 2H, 4H). On the daily chart, while not oversold, we have reached the RSI support line we have held since August 2019 (3 mo.). This line can easily be broken, but it is here where I am taking a position with a tight stop loss.
Price bounced from the 2.26 (0.236) fibb level, and will normally reach 0.50 fibb (2.37-2.40) before next big move.
Another option - is that it is setting up a much larger bearish head and shoulders pattern, which is a common pattern as I have noticed and mentioned in previous analyses.
Winter storms are still to come, even though this winter is predicted to be lighter than most. I think reaction was very strong in the past daily sell off, and should rebound to at least 2.37-2.40.
NATGAS bounced from support, potential for a further rise!
NATGAS bounced off 2.255 where it could potentially rise further to 2.430.
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Natural Gas sell can go away soon, good time to buyHello Traders, today's daily candle is showing us that there is a good price drop in natural gas , but the volume isn't the favoring the price action anyway which maybe an indication that this could be one of the last sells left in the current trend, yes there can be more sells we must remain open to that but currently the move isn't supported by the volume and the price is also coming to our last target of the short which we opened few days ago.
So, we will consider long for now, there are few possible scenarios i believe:
1. The price can bounce from the current blue channel in which it is, but it is very less likely less than 3-4% IMO
2. The price will come in the green box which will be our ideal buy zone for the long run, also please don't be too aggressive look for price action in that area to be specific i will look for buy around 2.18 or 2.16$ range area, but anything below 2.2 is good its a good even number for the market.
3. If it reach that red zone area it will be a surprise for me personally, ideally if i see good price action to the upside in the green area i will use this red zone as stop but if that isn't the case i.e if we don't get good buy action in the green zone i will look for buy here in the red zone, but i think this scenario will also be less likely IMO less than 10%.
So personally i am with scenario 2 and maximum chances are there for us.
Happy Thanks Giving!
May the markets be with you.
NATGAS bounced from support, potential for a further rise!
NATGAS bounced off 2.410 where it could potentially rise further to 2.660.
*Disclaimer.*
Trading leveraged products carries a high level of risk and may result in you losing substantially more than your initial investment. Pepperstone Group Limited is licensed and regulated by the Australian Securities and Investments Commission (AFSL 414530). Pepperstone Limited is authorised and regulated by the United Kingdom Financial Conduct Authority (FRN 684312). This information is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
NATGASUSD bounced from support, potential for a further rise!
NATGASUSD bounced off 2.410 where it could potentially rise further to 2.660.
*Disclaimer.*
Trading leveraged products carries a high level of risk and may result in you losing substantially more than your initial investment. Pepperstone Group Limited is licensed and regulated by the Australian Securities and Investments Commission (AFSL 414530). Pepperstone Limited is authorised and regulated by the United Kingdom Financial Conduct Authority (FRN 684312). This information is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
NATGASUSD bounced from support, potential for a further rise!
NATGASUSD bounced off 2.450 where it could potentially rise further to 2.660.
*Disclaimer.*
Trading leveraged products carries a high level of risk and may result in you losing substantially more than your initial investment. Pepperstone Group Limited is licensed and regulated by the Australian Securities and Investments Commission (AFSL 414530). Pepperstone Limited is authorised and regulated by the United Kingdom Financial Conduct Authority (FRN 684312). This information is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
Commercials are heavy long NGI was wrong on my last idea, NG went on and dropped lower. Trend remains down until we see a close above 2.33 then 2.48. Commercials are heavy long at levels not seen since 2016. Seasonality is bullish from now to Nov-Dec. we just need to see a sustainable rally to bolster the idea of a bottom for the year.
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NATGASUSD bounced from support, potential for a further rise!
NATGASUSD bounced off 2.450 where it could potentially rise further to 2.660.
*Disclaimer.*
Trading leveraged products carries a high level of risk and may result in you losing substantially more than your initial investment. Pepperstone Group Limited is licensed and regulated by the Australian Securities and Investments Commission (AFSL 414530). Pepperstone Limited is authorised and regulated by the United Kingdom Financial Conduct Authority (FRN 684312). This information is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
NATGAS approaching support, potential for a further rise!
NATGAS approaching support at 2.450 where it could potentially rise further to 2.660.
*Disclaimer.*
Trading leveraged products carries a high level of risk and may result in you losing substantially more than your initial investment. Pepperstone Group Limited is licensed and regulated by the Australian Securities and Investments Commission (AFSL 414530). Pepperstone Limited is authorised and regulated by the United Kingdom Financial Conduct Authority (FRN 684312). This information is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
Natgas Bear count @cryptoknee #elliottwave#cleanchart $natgas cleared the notes for this possible bearish count, thinking trunc 5th of the C and down we go, which goes against it bout to be winter and all... but do we have a surplus? the 2 of the 3 aint the clearest but got aways for the 2 to develope #elliottwave