September Pullback or Hurricane Rally? 8/25/2020
NG at the daily view.
Natural gas is stuck between two trend lines. They're acting as both support and resistance. Currently, Natty is above all major moving averages which is bullish on its face. That said, this could go in two directions.
1) September usually has a pullback due to cooler weather and less need for A/C. However, the temperatures are just high enough to not need heat or stay indoors. Judging by how many supports are below, I am not expecting a big pullback. The next support could be 2.25, 2.08, or 1.99... And they're all rising. They keyword is "usually."
2) That said, Hurricane Laura is also disrupting the gas and oil extraction and production sites. If Hurricane Laura causes more damage and cut off production, then the supply of oil and gas may decrease further. That would increase the price. A series of gas companies filed for bankruptcies back in June. That also decreases the supply.
In either case, Natty will definitely ramp up when we near October due to increased demand. In this cycle, this would be a terrible time to be a bear.
Natural gas is stuck between two trend lines. They're acting as both support and resistance. Currently, Natty is above all major moving averages which is bullish on its face. That said, this could go in two directions.
1) September usually has a pullback due to cooler weather and less need for A/C. However, the temperatures are just high enough to not need heat or stay indoors. Judging by how many supports are below, I am not expecting a big pullback. The next support could be 2.25, 2.08, or 1.99... And they're all rising. They keyword is "usually."
2) That said, Hurricane Laura is also disrupting the gas and oil extraction and production sites. If Hurricane Laura causes more damage and cut off production, then the supply of oil and gas may decrease further. That would increase the price. A series of gas companies filed for bankruptcies back in June. That also decreases the supply.
In either case, Natty will definitely ramp up when we near October due to increased demand. In this cycle, this would be a terrible time to be a bear.