The natural gas markets have fallen again during the trading session on Monday 01 June, breaking below the $1.80 level, reports Christopher Lewis for FXEMPIRE.
A slow market pattern
Natural gas markets initially fell on Monday to break down below the $1.80 level again. The point to be noted here is that there is a major gap underneath, which has been filled and typically will offer a bit of support.
Having said that, the market looks highly likely to continue to see noisy action down in this area as it looks like we are trying to form some type of rounding bottom. This is a terribly slow and arduous pattern that seems to take forever to form.
Trend reversal pattern
This is a trend reversal pattern, at least in theory but I think more than anything else what we are seeing here is the fact that the market is so cheap at this point it is almost impossible to imagine a scenario where it breaks down too much farther.
The $1.50 level looks to be a massive floor in the market not only from recent trading, but from historical pricing as well.
This is a market that is going to continue to be very noisy due to oversupply but there are also quite a few looming bankruptcies that could drive down supply eventually.
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Source: FXEMPIRE
