Natural Gas Remans Confined Within Expanding Triangle

At the base of its trend, natural gas continues to consolidate inside a growing expanding triangle. Earlier in the week, an effort was made to break over the 34-Day EMA trend barrier, but the following day, selling pressure sent natural gas prices back down. In the near future, it may keep declining and perhaps hit new trend lows.

In spite of the fact that the triangle's bottom border trendline is now below the previous trend lows, it would not be a reliable bearish indicator on its own. Price may decline but stay within the confines of the consolidation structure.

Lower End of Range Pullback Offers Better Entry Prices

If natural gas declines farther down the pattern's lower trendline before turning upward before new trend lows, the price would be better to take into account. A tighter protective stop might be possible at lower costs, but one should be wary of problems with the growing triangle. A stop might be placed at a price that is within the triangle's boundaries at a new trend bottom. If so, support could still be discernible, pushing natural gas upward. For bearish confirmation, natural gas would need to finish each day below the pattern's bottom line.

Bearish Candlestick Pattern to End the Week

Natural gas will conclude this week as a bearish shooting star candlestick unless it appears quickly, before the conclusion of the week. Given its location inside the pattern, this pattern does not have the impact it could have. It may be especially negative just before a trend or upswing tops. It might be seen as short-term negative since it is confined by the growing triangle. This also suggests that we should keep an eye out for any weakening of this week's low of 2.14 since a sharp decline below it might lead to a possible retest of earlier trend lows and the triangle's base. Daily price levels are less important than weekly price levels.