Natural Gas Futures Surge Amid Rising Geopolitical Tensions
Natural gas futures have been on a bullish run since last Friday, driven by increased uncertainty surrounding potential disruptions in Russian gas supplies to Europe. The delay in signing a new transit deal has sparked bullish activity in the market, with prices climbing above $3.978.
However, despite the upward momentum, natural gas futures are trading in overbought territory, which could lead to bearish pressures emerging. Geopolitical concerns, including the ongoing gas transit dispute and forecasts for milder weather, may limit further gains.
Looking ahead, the inauguration of President-elect Donald Trump on January 20, 2025, could bring significant shifts in energy policies, providing clarity on the market’s direction. Until then, investors can expect heightened volatility driven by geopolitical tensions and speculation.
In terms of technical analysis, key levels to watch include resistance near the 200-day moving average at $3.869 on the weekly chart. On the daily chart, $3.948 has been identified as a crucial resistance level, with immediate support at $3.599 and $3.343.
In conclusion, if natural gas futures fail to sustain above $4.202 in the coming week, a sharp decline could be on the horizon. Investors are advised to approach trading in natural gas with caution, as market conditions remain uncertain.
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