Buying natural gas on way down before next rally

Technically, natural gas is pulling back a bit after its recent run-up, edging closer to the big psychological support at $4.920. Early on December 4, investors saw clear selling pressure—the price opened with a gap up but quickly fell back to the day's low, which looks like traders taking some profits off the table. 

The charts back up the idea that the rally is losing steam. The Stochastic Indicator has flatlined, suggesting the market is moving into a consolidation phase. An even bigger red flag is the Chaikin Oscillator, which has been on a slow bleed for days, walking a different path than the price. This is often a sign of hidden selling and money flowing out. Add to that the Commodity Channel Indicator (CCI), which is in oversold territory, and the market seems to be overheated. The final nail in the coffin is fuel trading above the top Bollinger Band—a writing on the wall that the rebound party is over for now, and quotes will likely drop back to the middle of the road near $4.280.

Long-term fundamentals still look supportive, though. Investors got record US LNG shipments heading to Europe—a region that has committed to ditching Russian gas by 2027. Plus, a serious cold snap in key parts of the country is driving up heating demand. On top of that, one of the production units at the Freeport LNG plant is back online, putting a floor under US prices. All of this is creating a structural shortage that keeps buyers up in the game.

However, in the short run, a few clouds are rolling in. The weather forecast for the second half of December has become a coin toss, and American gas inventories are still sitting pretty above the seasonal norm. This might take the wind out of the sails when the weekly Energy Information Administration (EIA) storage numbers hit the tape.

The following plan for your trading may come on the scene:

Buy natural gas when it corrects to $4.470. Take profit 1: $4.920. Take profit 2: $5.150. Stop loss: $4.140.

This forecast is valid from December 4 till December 11, 2025.