Title: Natural Gas Futures Under Bearish Pressure After Trump’s Energy Emergency Declaration
Upon analyzing the recent movements in natural gas futures since President Trump’s inauguration, it is evident that these futures have faced renewed bearish pressure. The declaration of a national energy emergency in the US by President Trump has been the primary catalyst for this shift. The gap-down opening of natural gas prices this week, along with prices stabilizing at a resistance level of $3.915, further reinforces the impact of this resistance.
Looking ahead, a bearish outlook for the upcoming week is expected due to the forecast of milder February weather and a resurgence of supply. This could potentially negate the impact of the energy emergency order and create a supply crunch despite the current circumstances.
The appearance of price exhaustion in natural gas futures, despite bullish technical signals, indicates a deeper fall may be on the horizon. Concerns over the impact of the energy emergency are growing, and the upcoming weekly inventory announcement could confirm this bearish sentiment with a significant decline in withdrawal levels expected.
From a technical perspective, the daily chart shows natural gas futures forming a ‘bearish candle’ below the immediate support at 50 DMA at $3.422. The futures are currently hovering just below the 20 DMA at $3.780, indicating increased bearish pressure that could drive prices lower this week.
In the 4 Hr. Chart, extreme bearishness is indicated by a ‘Bearish Crossover’ with the 9 DMA moving below the 50 DMA. The formation of three outside bearish candles suggests further bearish movement, especially as the futures are trading below the 100 DMA at $3.783.
Traders should be prepared for a potential steep decline in natural gas prices, with a test of the $3.093 level likely if the significant support at the 50 DMA of $3.148 is not held.
Overall, natural gas futures are facing downward pressure following Trump’s energy emergency declaration, with bearish signals pointing towards a potential deeper fall in prices. Traders should exercise caution and be prepared for increased volatility in the coming weeks.