Natural Gas Futures point to pullback

On the daily timeframe, following an initial pullback the price has now decisively closed above the form resistance zone, now support, between $2.70 and $2.80 marked by previous highs and lows. While the price may continue higher in the near-term, momentum indicators remain highly overbought, highlighting the increased risk of a pause or pullback.

Above current levels, resistance is located between $2.9650 and $3.1020, marked by the November 2015 to January 2016 highs and lows. On the weekly chart, following the completion of the large basing pattern, the price has quickly moved higher to reach initial resistance around $2.90. While there are no signs the recent gains are becoming exhausted, we may see a small pause or pullback following a test of resistance, before continuing higher towards $3.50-$3.60 over the coming months.