NATURAL GAS - CAPPED UPSIDE & MORE DOWNSIDE?Symbol - XNGUSD
Natural Gas has recently been trading within a wedge pattern, which has now broken to the downside. This technical development suggests that the upside potential appears capped for the time being. The market is currently testing critical levels, and the broader outlook seems to be more focused on downward movement in the short to medium term.
There is a possibility of a breakdown retest around the 3.25 - 3.30 area, which could act as a key resistance zone. If this level holds, we could see a sell-off, confirming further downside pressure. The outlook for Natural Gas, in this context, leans bearish, with the price potentially targeting the 2.80 - 2.70 range in extension.
The market is closely watching weather forecasts and energy inventories, with any cold weather or supply disruptions potentially offering temporary support. However, unless these fundamentals change significantly, the technical breakdown suggests limited upside potential and further downside risks.
Resistance levels: 3.28, 3.20
Support levels: 3.00, 2.80
Technically, the current outlook favors a move lower, with further downside expected if the price fails to reclaim the 3.25 - 3.30 resistance. Should the retest of these levels hold, we could see a sell-off towards the 2.80 - 2.70 area. A failure to hold above the 3.10 support would reinforce the bearish sentiment and suggest further declines.
