US natural gas prices (NATGAS) are plunging today. NATGAS is down over 5% on the day. There is no specific news supporting the move and today's plunge in natural gas prices can be driven by overall increase in risk aversion and strengthening of US dollar, that is putting pressure on commodity prices. In fact, new 8-14 day weather forecasts from NOAA point to below-average temperatures over the larger area of the United States than forecasts from earlier this week. However, as US heating season is over already and we are entering a period when even below-average temperatures do not require heating (as average temperatures are higher), impact of weather forecasts is not as big as it used to.
Taking a look at NATGAS chart at H1 interval, we can see that price dropped to the $2.22 area, where a short-term support zone can be found. This area is marked with previous price reaction as well as the 38.2% retracement of a recent upward impulse. A break below would pave the way for a test of the next support in-line - $2.15 zone. However, it looks like the first attempt at breaking below turned out to be a failure and an attempt to launch a recovery move off the $2.22 area can be spotted at press time. In case the recovery run lasts, the first target for bulls will be the $2.30 price zone, which was broken earlier today.
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NATGAS at H1 interval. Source: xStation5
