NATGAS targets $4.00 in light of improving weather conditions
Natural gas prices in the US, Asia and Europe are collapsing at the start of the year. The downward movement that began in the second half of December 2022 continues, with the US benchmark index (NATGAS) down nearly 9% today. A warmer than expected start to the winter period can be cited as a reason, with temperatures in Europe and the US above historical averages for the period. Such developments have helped to further allay fears that a dreaded energy crisis involving blackouts will not come. NATGAS is down 20% in a week and about 35% in the past month.
Natural gas prices fell further on Tuesday. Taking a look at NATGAS at the D1 range, we can see that prices are breaking below key support near $4.30 of MMBTu, marked by a 161.8% outside retracement as well as a range of the previous downward momentum. Breaking through this hurdle without any major reaction from the demand side could suggest the strength of the bearish momentum and signal a potential test of the $3.60 support zone marked by December 2021 lows.
NIGHTGAS at D1. Source: xStation5
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