The Moving Average Battle Taking Place in Natural Gas

I think the setup presently occurring in natural gas is pretty interesting, as you can see from the chart below the commodity is currently bouncing between its 50- and 200-day moving averages, hitting the 50-day as resistance and finding the 200-day as a support almost on a daily basis over the last week.

I last addressed nat gas and its moving averages on August 13th when I talked about whether these two averages could hold as support, although I was seeing negative divergences in momentum and money flow. So far, it appears the 50-day was not strong enough to fight the divergence but the 200-day MA is doing its best to hold on. It seems there might be a little more weight leaning on the downside from here,  but any positive news we get on Friday from Jackson Hole could shift the playing field.

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About Andrew Thrasher

Andrew Thrasher is a Portfolio Manager for an asset management firm in Central Indiana. He specializes and writes about technical analysis as well as macro economic developments.