Natural Gas Price Forecast: Understanding the Bearish Reversal Amid Market Pullback

Bearish Market Momentum

Natural gas is on track to end the week with a bearish outlook, with a drop leading to a potential bearish reversal. Trading remains near daily lows, reflecting ongoing sellers dominating the market. The weekly chart presents a bearish shooting star pattern, indicating that market sentiment may further weaken.

Daily Chart Analysis

The current market scenario shows natural gas poised to test support at the 20-Day MA, sitting at 2.10. A negative trend initiated on a dip below Thursday’s low of 2.19 follows a failed rally that peaked at 2.27. This reversal is compounded by a typical pullback after the first rally from recent lows.

Critical Levels to Watch

• 20-Day MA support at 2.10
• 50% Fibonacci retracement at 2.09
• Next target zone: 61.8% Fibonacci retracement at 2.04

Given the bearish signals on the weekly chart, any drop below this week’s low foreshadows a bearish reversal. However, this pullback may only precede a bullish trend reversal, with potential upward movement anticipated after the current downswing.

Anticipation of Recovery

Once the pullback concludes, natural gas prices are expected to target higher levels, beginning with the 200-Day MA at 2.335. As this upswing represents the first challenge to the 200-Day line since earlier setbacks, initial resistance may contribute to a downward rejection.