Natural Gas Futures Near Major Resistance After Trump’s EU Comments
On Friday, natural gas futures are facing exhaustion following comments by U.S. President-elect Donald Trump. Trump has stated that the European Union must purchase U.S. oil and gas to offset its deficit with the U.S. or face tariffs.
This statement has significant implications for natural gas traders, who may be skeptical about the impact of other factors on natural gas prices. The European Union typically purchases a large amount of natural gas from the U.S. at this time of year, but this year they have enough stock to meet their heating demand.
Additionally, mild weather could further reduce demand for natural gas, leading to concerns about lower prices due to potential tariffs if the EU does not buy gas and oil from the U.S. This new factor is already affecting gas and oil prices, with weather forecasts showing milder temperatures in northwest Europe next week.
Technical Analysis: Key Levels to Watch
On the weekly chart, natural gas futures are approaching major resistance at the 200 DMA at $3.859. The formation of a bullish crossover by the 9 DMA and 20 DMA crossing above the 100 DMA at $2.500 suggests significant support.
However, despite nearing immediate support at $3.556, natural gas futures are at a critical point that could trigger selling pressure amid concerns about demand and supply imbalances following Trump’s statement.
If there is a sharp decline after Trump takes office, the first support for natural gas futures will be at the 9 DMA at $3.023, followed by support at 20 DMA at $2.680 and 50 DMA at $2.838.
Conclusion
In conclusion, if natural gas futures break below the 9 DMA, a steeper fall may occur in the last week of the year. Readers are advised to trade natural gas at their own risk based on this analysis.
Overall, Trump’s comments on EU oil and gas purchases have the potential to impact natural gas prices and trading strategies. Stay tuned for further developments in the market to make informed investment decisions.