- Natural gas futures break out of neutral triangle
- Technical outlook favors further gains; eyes on 3.65
Natural gas futures are flashing bullish signals after breaking out of a neutral symmetrical triangle above 3.50 on Monday.
While downside risks remain – given that May’s rebound from 2.83 is still capped below the descending resistance line at 3.65 and the 38.2% Fibonacci retracement of the March–April decline – technical indicators suggest a bullish continuation may be on the horizon.
The RSI has climbed above its neutral 50 level, and the MACD has entered positive territory for the first time since March, both reinforcing the current bullish price action.
A sustained move above 3.65 could pave the way toward the 50% Fibonacci level at 3.90, with further gains potentially targeting the 61.8% Fibonacci mark at 4.16. Beyond that, the tentative resistance line connecting the 2022 and 2025 highs could come into focus near 4.35.
However, if the price fails to break above 3.65 and remains below the neckline of the February–March head and shoulders pattern, it could retest the 3.50 area before sliding towards the 23.6% Fibonacci level at 3.35. The short-term support trendline at 3.28 and the 200-day SMA may provide a final line of defense before attention shifts to April’s lows.
Overall, appear poised for another leg higher, with confirmation coming on a break above 3.65. Until then, a period of sideways consolidation may persist.