On analysis of movement of Natural Gas futures price since the U.S. President Donald Trump has expressed his intention for imposing tariffs on Chinese imports, I find that the reflection of fearful magnitude of possible after-effects of trade war are clearly visible on the repressive moves of the Natural Gas futures. After weekly closing on March 16th, 2018, I find that the Natural Gas futures are at a crucial point before taking a final directional move.
OVERVIEW
I find the following factors are playing an important role in deciding the further directional move:-
1. Since the U.S. President Donald Trump expressed his intention to impose tariffs on Chinese imports and will target the technology and telecommunications sectors, a sell-off in riskier assets has started as the traders feared that China would be forced to retaliate, leading to a tit-for-tat trade war between the world’s largest two economies.
2. Natural Gas, being the most volatile energy commodity with a long history of price explosions and implosions, could not be able to be spared off with the worries of waging of such an insecure scenario in case of beginning of any such worst economic hassle when everyone wants to be on the way of developing with mutual cooperation.
3. Tariffs could lead to a destructive trade war with serious consequences for U.S. economic growth and job creation, hurting consumers, businesses, farmers and ranchers.
4. U.S. energy pipeline developers say they intend to pursue exemptions to the Trump Administration's proposed steel tariffs, as concerns grow for those companies and from key exporters to the United States like South Korea.
5. The inventory announcement on March 15th, 2018 was also not too encouraging, which sent this market lower.
6. Gold prices traded sharply lower amid dollar strength as focused shifted to the Federal Reserve’s monetary policy decision next week while easing fears of a global trade war lessened safe-haven demand.
CONCLUSION
1. On analysis of the movement of Natural Gas futures price on March 17th, 2018, I find them at very crucial point, even inside a “Decisive Trading Zone”.
2. A breakout of this “Decisive Zone” will finally decide the further directional move during the upcoming weeks.
3. No doubt that the opening level and further resultant moves on the first trading session of the Week of March 18th, 2018 will play important role.
4. I find that after moving in a narrow range, Natural Gas futures price is looking for the next fundamental driver in this market to take a decisive step.
5. If, we find with an unexpected easing in possibilities of trade war fear, Natural Gas futures price may find a volatile move before taking a final directional move.
6. I find the Natural Gas futures price will no longer going to be in passive moves during the Week. I, therefore, advice to be careful till Natural Gas futures price settles down on a definite directional move.
7. Finally, I wish to share my conclusive trading zones for Natural Gas futures price in the following Charts:-
DISCLOSURE
1. This content is for information and educational purposes only and should not be considered as an investment advice or an investment recommendation. Past performance is not an indication of future results. All trading carries risk. Only risk capital be involved which you are prepared to lose.
2. Remember, YOU push the buy button and the sell button. Investors are always reminded that before making any investment, you should do your own proper due diligence on any name directly or indirectly mentioned in this article. Investors should also consider seeking advice from an investment and/or tax professional before making any investment decisions. Any material in this article should be considered general information, and not relied on as a formal investment recommendation.