Welcome to Extreme Investor Network, where we provide expert analysis and insights into the stock market, trading, and all things related to Wall Street. Today, we’ll be discussing the recent decline in natural gas prices following a failed breakout above the 20-Day MA.
After a successful test of resistance around the 20-Day MA and top trendline earlier this week, natural gas prices have started to decline. The June 24 swing low at 2.635 failed to hold as support, indicating that the 200-Day MA around 2.47 will likely be tested as support in the near future.
It’s worth noting that the 50-Day MA is converging with the 200-Day line, potentially providing additional support around the 200-Day line. However, if the 200-Day line fails to act as support, lower potential targets for natural gas prices are identified at the 50% retracement and 61.8% Fibonacci retracement levels at 2.37 and 2.18, respectively.
Looking ahead, a drop to the 200-Day MA seems more likely given the current market conditions. The rejection of natural gas prices at the 20-Day line and the formation of a descending ABCD pattern signal a potential decline below the 200-Day line towards the 50% retracement level at 2.34.
Furthermore, a lower support zone starting around 2.235 has been identified, indicating that natural gas prices could continue to decline in the coming weeks. With selling pressure dominating the market, next week could see natural gas prices facing further downward pressure.
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