Fading bullish momentum is good reason to sell natural gas

Natural gas (NG) quotes are now entering a correction following a recent surge to an 8-month high, suggesting that bulls are losing their grip on the market. On Thursday, the price opened near its daily peak but fell under selling pressure, forming a red candlestick on the chart during early trading.

The technical picture on the H1 timeframe confirms fading bullish momentum. The Stochastic Oscillator is reversing downward, with the fast %K line (52) crossing below the slow %D one (57). This is a clear signal of an impending correction and waning buyer interest. Meanwhile, the Chaikin Oscillator is in negative territory, showing no signs of exiting this zone. The prevailing bearish sentiment indicates capital outflows and increasing seller pressure. The Commodity Channel Index (CCI), however, presents a very conflicting picture: deeply oversold conditions (-175) create a risk of a technical rebound, but this potentially bullish signal is being completely overlooked by the market.

Fundamentally, the short-term price surge was triggered by abnormally freezing weather in the eastern United States, which dramatically boosted heating demand. Yet, this factor proved temporary, as forecasts for the coming week predict only a moderate cold snap. According to NatGasWeather.com, domestic NG consumption is expected to drop by the weekend, depriving the market of its key driver seen in previous days.

The long-term fundamental outlook remains moderately bearish, despite record liquified natural gas (LNG) export volumes. The main factor weighing on the market is rising domestic output. According to the Energy Information Administration (EIA), US production is at its highest. Furthermore, storage levels are still above seasonal norms, providing a reliable buffer against any sudden spikes in demand and capping the potential for sustained price growth.

Take into account the following trading strategy:

Sell natural gas when the price climbs above the $4.150 level. Take profit: $3.890. Stop loss: $4.260.

The forecast is valid from November 13 to November 20, 2025.