# Unlocking Potential: Analyzing the Bullish Patterns in Natural Gas Trading
Welcome to the Extreme Investor Network! If you’re curious about the nuances of the stock market, especially in the commodities space, you’ve come to the right place. Today, let’s dive into the current action in natural gas trading, understanding the significance of emerging candlestick patterns and what they could mean for your trading strategy.
## The Emergence of a Potentially Bullish Hammer
As of our latest market observations, natural gas prices are maintaining their position above the midpoint of the day’s trading range. This suggests a strong chance of concluding the day with a potentially bullish hammer or doji hammer candlestick pattern. Recently, the price peaked at $3.58, while a breakdown from an inside day pattern on Thursday pushed the market to test critical support levels. What’s more promising is that today’s closing price is poised to be above Thursday’s low of $3.47, setting the stage for a potentially bullish outlook heading into next week.
### What Is a Bullish Hammer?
A bullish hammer candlestick pattern signifies a potential reversal in a downtrend, indicating that buyers have stepped in to drive prices higher after a period of selling. Traders often look for confirmation in subsequent sessions to validate this pattern, making it a vital tool in your trading arsenal.
## The Power of a Three-Day Bullish Combo
But the bullish indicators don’t stop with today’s hammer. There’s a richer context to consider—the patterns formed over the last three days create an intriguing bullish combination known as a hikkake pattern. This pattern, which can serve as both a reversal and continuation signal, is compelling because natural gas appears ready to close within yesterday’s range and in the upper half of today’s price action.
What’s critical here is the potential for a collapse of the earlier bearish breakdown, which now seems to show signs of a failed pattern. A rally above Thursday’s high of $3.75 would confirm this bullish hikkake setup, but traders should also watch for an advance beyond today’s high as an earlier valid bullish signal, propelling the market upward.
**Pro Tip:** Always consider that a drop below today’s low would indicate short-term bearish sentiment and signal a failure of this bullish setup.
## Navigating Potential Resistance Levels
For savvy traders, understanding resistance levels is essential for strategic planning. Initial upside targets for natural gas trading begin at the four-day high of $3.83 and the 50-Day Moving Average, currently sitting at $3.89. Additionally, there is a declining trendline that could intersect with the 50-Day MA, providing traders with crucial insights on potential price action.
If we see an upside breakout beyond this downtrend line, the next target would be the 50% Fibonacci retracement level at $4.12, with subsequent resistances at the interim swing high of $4.26 and the 61.8% Fibonacci retracement at $4.30.
### Conclusion: Keep Your Eyes on the Market
As we venture into the upcoming trading sessions, it’s critical to keep track of these unfolding patterns. Candlestick formations like the bullish hammer and three-day hikkake not only aid in predicting potential price movements but also assist in making informed trading decisions in a volatile marketplace.
For daily updates and to stay ahead in the stock market game, don’t forget to check out our **economic calendar** here at the Extreme Investor Network. Staying informed is your best strategy in navigating the complex world of trading.
Let’s continue to unlock new trading opportunities together!
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