FX.co ★ Natural Gas (NG)

On Tuesday, signs of rising pressure on the price of natural gas appeared, with a bullish engulfing candlestick pattern about to finish. The session started at $3.16, a somewhat lower daily low that successfully challenged support close to the uptrend line. Buyers were drawn to the dip, which led to an intraday surge above Monday's high of $3.31. A close above Monday's high will validate a one-day bullish reversal signal. However, given the underlying purchasing momentum, it looks likely that the session will close in the top third of the day's range. Natural gas could close the session at its second-highest daily closing price of the current bull trend due to Tuesday's performance. That would be a strong indication that buyers are still in charge. As a result, there is still a chance for an upside breakout from the recent consolidation range. However, the bullish engulfing pattern by itself is a positive preliminary sign of increasing demand. Whether that can continue is still up in the air. As part of the bullish trend structure, Tuesday's low creates a new higher swing low at $3.16. It is currently a crucial level of support for the trend structure. The intermediate swing low around $3.12 and the June swing low at $3.02 become targets if it breaks. Additionally, the rising 50-day moving average, which is currently close to $3.00, provides important dynamic support. Near recent highs, there is a potentially important resistance zone that is restricted at $3.44 by the 200-day moving average. With a high of $3.40, which also represented the peak of the uptrend that began with the April low, the indicator was verified as resistance during the climb. The next upside target level is the lower swing high of $3.49 if that resistance zone is broken. Notably, a bullish trend reversal signal would be provided by a recovery above that swing high.