FX.co ★ Natural Gas (NG)

Due to a U.S. vacation, natural gas completed the week with a shorter session on Friday. A narrow range doji candlestick pattern emerged, indicating that indecision dominated the week. Both the opening and closing prices for the week were close to $3.25. Although a breakout above or below this level could signal the start of a sustained advance in that direction, the week did not yield any new information. Because it was a three-week high, last week's high of $3.32 is more significant on the upside than this week's high. Targeting the recent resistance zone close to the $3.42 level would be more likely if there was a clear rise above it, which would indicate a breakout of this range. Over the previous eight weeks, a growing, expanding formation of natural gas has formed. Over the previous month, support has consistently maintained close to the 20-week moving average, providing more proof of a growing bullish structure. This chart illustrates how a bullish trend developed over a week. Since the previous resistance level has turned into a support level, it suggests that prices could go up further and continue the upward trend. If the price continues to rise, the recent high, the 200-day moving average, and the lower swing high from March indicate the initial upside target zone. When combined, they represent an upside potential of $3.42 to $3.49. A bullish trend reversal signal is produced if that top level is surpassed, and the long-term uptrend line and the 61.8% Fibonacci retracement of the previous downtrend at $3.53 become targets. Natural gas would be in a position to test weekly support close to last week's low of $3.06 and the 20-week moving average, which is likewise around $3.06, if it fell below this week's low. Its potential importance as a pivot zone is further enhanced by the fact that an uptrend line is likewise in line with that price range. Natural gas continued to form an ascending expanding wedge on Thursday, rising to a three-day high of $3.35 before running into resistance and retreating during the day. Brief-term range constriction was further indicated by the pullback, which was a successful test of resistance close to a brief descending trendline. The first lower boundary of near-term consolidation is indicated by a trendline crossing recent daily lows, forming a little symmetrical triangle. The tendency is still upward, but a move over Wednesday's high of $3.38 is required to validate strength. The smaller consolidation pattern, which is forming inside the broader ascending expanding wedge formation, would break out if there was a clear rise above Wednesday's lower swing high of $3.38. The current high of $3.42 and the lower swing high of $3.49 from early March would thereafter be expected to provide resistance. The next downward objective is the lower boundary of the ascending wedge pattern if the lower boundary line spanning recent daily lows is violated. The recent higher swing low of $3.06 and the 50-day moving average, which is close to $3.09, serve as its anchors. Another sign of growing momentum is the 50-day moving average, which is about to pass above the wedge's lower limit and reflects the improving trend structure. Additionally, the weekly chart is displaying indications of strength that point to potential future gains. A rally over last week's high set off a one-week bullish reversal this week, with a higher weekly low of $3.17 and a higher high of $3.38. That breakout strengthened the emerging short-term bullish trend after three weeks of successful tests of support close to the 20-week moving average. The 50-week moving average at $3.42 and the 200-week moving average close to $3.35 identify resistance on the weekly chart. While this week's high and low set additional important price levels to keep an eye on for confirmation of strength or weakness as the building wedge formation moves forward, those resistance levels are in good alignment with the upside goals noted on the daily chart.