We expect more upside for natural gas during its upcoming trading.
Spot natural gas prices (CFDS ON NATURAL GAS) jumped up during the recent trading at the intraday levels, to achieve strong daily gains until the moment of writing this report. The price rose by 6.22% to settle at the price of $4.986 per million British thermal units, after rising during yesterday’s trading by a rate of 2.60%.
Natural gas futures rose more than 5% to a three-week high to settle above $4.9 per million British thermal units on Thursday, as traders digested news of a large-scale Russian attack on Ukraine. Demand for heating also rose after a number of storms swept across several regions of the world, including Europe.
Russian forces launched their expected attack on Ukraine on Thursday, with President Vladimir Putin ignoring international condemnation and sanctions and warning other countries that any attempt to intervene would lead to “consequences they have not seen before.”
Big explosions were heard before dawn in Kiev, Kharkiv and Odessa as world leaders denounced the initiation of an invasion that could cause heavy casualties, bring down Ukraine’s democratically elected government and threaten the post-Cold War equilibrium on the continent.
The leaders of the United States and the European Union pledged to impose tougher sanctions on Russia after its president, Vladimir Putin, announced an attack on its neighboring country. The consequences of these sanctions could push Russia’s energy exports out of world markets. Meanwhile, cold weather continued to move across much of the United States, increasing the demand for gas for heating.
Technically, the price continues to rise in light of its trading along a major bullish trend line in the medium term, as shown in the attached daily chart, with the continuation of positive support for its trading above its simple moving average for the previous 50 days, in addition to the influx of positive signals in the relative strength indicators. The price, with its recent rise on the intraday levels, attacked the important resistance level 4.954.
Therefore, we expect more upside for natural gas during its upcoming trading, especially in the event that it breaches the hurdle of the resistance 4.954, to target after that the pivotal resistance level 5.710.
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