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 Traders Academy Club Spoiler alert – free memberships are available! Let’s start our analysis from the highest timeframe which will be the daily chart here.
You can watch the video explanation of this idea here
Natural Gas D1(Daily) Chart Analysis – Key Resistance Zone, Bearish Divergence, Volumes Indicator
On the daily chart, the price which is moving higher has reached a key resistance zone formed by the 100%(4.174) Fibonacci expansion level of the first wave we have. The price respected this key resistance zone and is currently bouncing lower from this zone. We also have a bearish divergence that has formed between the first high that has formed at 3.789 and the second high that has formed at 4.149 based on the MACD indicator which we may consider as evidence of bearish pressure. Also, based on the Volumes indicator we could see that the volumes are dropping, we may consider this as another evidence of bearish pressure. We may now move down to lower timeframe and look for evidences supporting this bearish view.
Natural Gas H1(1 Hour) Chart Analysis – Bearish Trend Pattern, Key Resistance Zone
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 in the form of double wave to the upside. While measuring the first wave of this correction we have a key resistance zone that has formed by the 61.8%(4.063) – 100%(4.135) Fibonacci expansion levels. Until this key resistance zone holds my short term view remains bearish here and I expect the price to move lower further.
Technical Analysis & Forecast Summary
Natural Gas D1(Daily) Chart Analysis
- Key Resistance Zone, Bearish Divergence, Volumes Indicator
Natural Gas H1(1 Hour) Chart Analysis
- Bearish Trend Pattern, Key Resistance Zone
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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Happy Trading!
Yordan Kuzmanov
Chief Trader at the Traders Academy Club
