A Tactical Trade In Natural Gas

Here's a daily chart of Natural Gas, which fell 60% from its 2018 high to its August 2019 low. Since then, prices have been meandering around those lows, with momentum staying in a bullish regime. This week, prices are attempting to break back above broken support at 157 which would confirm a failed breakdown and shift the reward/risk back in the bulls favor.

Click on chart to enlarge view.

This type of failed move traps sellers and creates a natural buyer if prices can get back above support at 157. We'll define our risk against that level and look for a move up towards 200, at which point we can reevaluate and see if our secondary target of 225 is in reach.

This is a counter-trend move so it's low probability in nature, but given the few points of potential downside and 40+ points of potential upside, it's worth taking a shot on the long side.

If you enjoyed this post and want access to all of our premium research, start a 30-day risk-free trial or sign up for our "Free Chart of the Week" to receive more free research like this.

Thanks for reading and let us know if you have any questions!

Allstarcharts Team