Natural Gas Looks To Move Higher

Natural Gas Futures---Natural gas futures in the November contract settled last Friday in New York at 2.21 while currently trading at 2.34 up about 13 points for the trading week as prices are right near a 3 week high.

In my opinion I do believe that natural gas has bottomed as we continually bounce off the 2.20 level over the last several months as we enter the highly volatile winter months which can send prices sharply higher as I see no reason to be short at these depressed prices. Gas prices are trading above their 20 day but slightly below their 100 day moving average standing around the 2.39 level so be patient and wait for a 4 week high to develop before entering into a bullish position as I will not go short as I think the downside is very limited.

Fundamentally speaking gas prices are higher today on short-covering spurred on by concern a tropical depression in the Gulf of Mexico could become Tropical Storm Nestor and disrupt production from U.S. gas rigs in the Gulf. Money managers have record high net short positions for this time of year in seven gas contracts in data going back to 2014, which provides some fuel for a potential short-covering rally.

TREND: MIXED

CHART STRUCTURE: IMPROVING

VOLATILITY: LOW

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