How Low Are Natural Gas Prices Going?

04/13/2015 7:00 am EST

Focus: FUTURES

Since natural gas futures in the June Contract are now trading below their 20- and 100-day moving averages, coupled with the fact that natural gas prices continue to move lower as warm weather sweeps through Midwestern states in the US, Michael Seery, of SeeryFutures.com, recommends this shorting opportunity.

Natural Gas Futures—Natural gas futures in the June contract are trading below their 20- and 100-day moving average, hitting a new contract low, as I’m now recommending a short position from around 2.60 level, placing your stop loss above the 10-day high which currently stands at 2.77, risking 17 points or $1,700 per contract plus slippage and commission as the chart structure is solid at the current time.

Natural gas prices continue to move lower, due to the fact of large supplies settling last Friday at 2.76, currently trading at 2.60 down about 16 points for the trading week, as warm weather has entered the Midwestern part of the United States, also pushing down gas prices at the current time.

The 10-day high will not be lowered until at least another week, so you are going to have to be patient with this trade, keeping the proper stop loss, risking 2% of your account balance on any given trade, as the trend seems to be getting stronger on a weekly basis, so play this to the downside and take advantage of any rallies as, in my opinion, I do think prices are headed lower.

Trend: Lower—Chart Structure: Solid

By Michael Seery of SeeryFutures.com

Related Articles on FUTURES