Head and Shoulders pattern formed on the weekly chart..
As i mentioned before at my previous article for natural gas we are entering low demand season and that's of course affects the movement of the natural gas price.
Now watching it on more longer time frame and particular at weekly we can see an inverse Head and Shoulders formation that is unfolding and it's more likely to break around early's of June as i show on my chart.
For the time being fundamentals support the price of 3$ per MMBtu.
At 3,250 of course there is a strong support level and at 3,40$-3,50$ area is the roof for this season as we have the neck line of the Head and Shoulders pattern(Blue line) mentioned and the 61,8% critical Fibonacci Retracement since the descending move that started at December 2016.
Plus a lot of shorts there are placed at 3,5$ level.
Conclusion
Taking into consideration all the above,i believe that price will flactuate in that red channel until early's June before it continues higher following the ascending red channel which exists since January 2016(Future's candlestics are shown on the chart).
The extra boost for a bullish continuation will be the break of 3,5$ level that will mean the neck line is broken,also 61,8% Fibonacci retracement will be broken and shorts-squeeze will occur.
Good short chances with price above 3,350$ per MMBtu level.
Possible targets around 3$ level.
Buy stop above 3,450$ level.
Thank you for your time.
Happy trading Guys!
Now watching it on more longer time frame and particular at weekly we can see an inverse Head and Shoulders formation that is unfolding and it's more likely to break around early's of June as i show on my chart.
For the time being fundamentals support the price of 3$ per MMBtu.
At 3,250 of course there is a strong support level and at 3,40$-3,50$ area is the roof for this season as we have the neck line of the Head and Shoulders pattern(Blue line) mentioned and the 61,8% critical Fibonacci Retracement since the descending move that started at December 2016.
Plus a lot of shorts there are placed at 3,5$ level.
Conclusion
Taking into consideration all the above,i believe that price will flactuate in that red channel until early's June before it continues higher following the ascending red channel which exists since January 2016(Future's candlestics are shown on the chart).
The extra boost for a bullish continuation will be the break of 3,5$ level that will mean the neck line is broken,also 61,8% Fibonacci retracement will be broken and shorts-squeeze will occur.
Good short chances with price above 3,350$ per MMBtu level.
Possible targets around 3$ level.
Buy stop above 3,450$ level.
Thank you for your time.
Happy trading Guys!
Trade active
Comment:
Please don't get trapped from this fake breakout it's too early and some others reasons explained in coming article justifies why you shouldn't buy this breakout.
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