Technical indicators appear to support a positive outlook for natural gas prices at least in the short term, but cautious traders could decide to enter the market only when the price moves above key resistance levels, according to technical analysts.
The September New York Mercantile Exchange (Nymex) natural gas futures contract lost steam Tuesday after tearing higher and settling the week’s opening session up 11.2 cents at $2.235/MMBtu. The prompt month contract was down 4.0 cents at around 11:15 a.m. ET. October futures were down 3.7 cents, last eyed at $2.320 after settling up 11.0 cents Monday.
NGI’s Pat Rau, senior vice president of Research & Analysis, said, “Monday’s rally left the September contract just shy of being overbought.” Rau noted the prompt month contract had been trading in a “mini horizontal band” since Aug. 9. The band was marked by a high at $2.301 and a low at $2.097.
