Hi Traders! Natural Gas short term forecast and technical analysis is here. The way I would like to analyze the chart for setups is based on multi-timeframe confirmations because in my POV if we get more evidences on different timeframes for the same direction then it makes the setup much more reliable. If you would like to learn more about the way we trade and the technical analysis we use then check out the Home Trader Club Spoiler alert – free memberships are available! Let’s start our analysis from the highest timeframe which will be the H4 chart here.
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Natural Gas H4(4 Hours) Chart Analysis – Bearish Divergence, Most Recent Uptrend Line Breakout, ADX Indicator
On the H4 chart, the price which was moving higher created a bearish divergence that has formed between the first high that has formed on 15th August 2024 and the second high that has formed on 20th August 2024 based on the MACD indicator which we may consider as evidence of bearish pressure. Also, the price which is moving lower has broken below the most recent uptrend line which we may consider as another evidence of bearish pressure. In addition to this, the ADX indicator gave a bearish signal here at the cross of -DI (red line) versus +DI (green line) and the main signal line (silver line) reads value over 25 which we may consider as yet another evidence of bearish pressure. So everything looks good here for the bears and we may now move down to one timeframe lower and look for evidences supporting this short term bearish view.
Natural Gas H1(1 Hour) Chart Analysis – Bearish Trend Pattern, Two Strong Resistance Zones
On the H1 chart, the price which is moving lower has created a bearish trend pattern in the form of three lower highs, lower lows which we may consider as evidence of bearish pressure. Generally, after a bearish trend pattern, we may expect corrections and then further continuation lower. Currently it looks like a correction is happening and also, there are no signs opposing this short term bearish view at the moment. Also, we had two strong support zones that has formed and the price which is moving lower has broken below these zones and is holding below them, we may consider this as yet another evidence of bearish pressure. Currently, these strong support zones are acting as strong resistance zones for us. Until these two strong resistance zones (marked in red) shown in the image below hold my short term view remains bearish here and I expect the price to move lower further after pullbacks.
Technical Analysis & Forecast Summary
Natural Gas H4(4 Hours) Chart Analysis
- Bearish Divergence, Most Recent Uptrend Line Breakout, ADX Indicator
Natural Gas H1(1 Hour) Chart Analysis
- Bearish Trend Pattern, Two Strong Resistance Zones
Trading Tips
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this short-term sell setup then you can use any setup and strategy that you have in your arsenal to look for bearish moves and join this sell trade.
Also, don’t forget to protect your sell trade using a stop loss and make sure to set a target and keep a proper risk/reward ratio.
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Arvinth Akash
Home Trader Club Team.
