Natural Gas Price Analysis: Set for a volatile action ahead of inventory figures

Natural Gas prices are going through a corrective move after failing to sustain above $2.58.
The US EIA is expected to report a build-up of inventory by 119 bcf for the week ending May 19.
Natural Gas prices resumed their upside journey after a bullish Hidden Divergence.

Sagar Dua FXStreet

Natural Gas futures are going through a corrective move after failing to sustain above $2.58 in the Tokyo session. The gas price is expected to remain on tenterhooks as investors are awaiting the release of the weekly gas inventory data.

According to the estimates, the United States Energy Information Administration (EIA) is expected to report a build-up of inventory by 119 billion cubic feet (bcf) for the week ending May 19.

Meanwhile, the US Dollar Index (DXY) has refreshed its two-month high at 104.06 as US debt-ceiling issues have escalated anxiety among investors.

Natural Gas prices resumed their upside journey after a bullish Hidden Divergence on a four-hour scale. The asset formed a higher low while the Relative Strength Index (RSI) (14) formed a lower high, which indicated that the momentum oscillator got oversold in an uptrend and produced a bargain buy opportunity for the market participants.

Upward-sloping 50-and 200-period Exponential Moving Averages (EMAs) at $2.51 and $2.41 respectively, indicates more upside ahead.

A break into the bullish range of 60.00-80.00 by the Relative Strength Index (RSI) (14) will strengthen Natural Gas futures further.

Should the asset break above the immediate resistance of $2.60, NG bulls will march firmly towards May 22 high at $2.69 followed by March 02 high at $2.88.

On the flip side, a break below May 17 low at $2.43 will expose the asset to April 20 low at $2.28. A break below the latter will further drag the asset toward May 05 low at $2.09.

Natural Gas four-hour chart

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

AUD/USD bulls regain control above 0.6950 amid USD retreat

AUD/USD regains traction and extends the previous day's bounce from the weekly low, aiming for 0.7000 in Asia on Friday. The overnight pullback in US bond yields keeps the US Dollar below an 18-month high, which in turn offers some support to the pair. Meanwhile, hawkish RBA expectations also keep the major underpinned.

USD/JPY holds gains near 158.00 after Japan's weak Household Spending data

USD/JPY clings to gains around 158.00 after data showed on Friday that Japan's Household Spending fell for the ninth straight month, undermining the Japanese Yen. Meanwhile, the US Dollar remains depressed as the overnight fall in US bond yields counters a hawkish Fed and geopolitical uncertainties, could cap any downside in the pair.

Gold remains range-bound below $4,200

Gold has given up some ground after an initial bullish attempt to reach weekly highs, returning to below the $4,200 mark per troy ounce on Friday. The US Dollar’s strong upside momentum, combined with rising US Treasury yields across the curve, seems to keep further gains in the yellow metal under scrutiny.

Has Bitcoin really escaped the macro forces it was built to fight?

Over 17 years ago, Satoshi Nakamoto designed Bitcoin (BTC) on the back of a global financial crisis as an alternative to the global monetary system outside the control of central banks, governments and traditional intermediaries. This raises a key question: has Bitcoin really become independent of the macroeconomic forces it was built to challenge?

The Euro is not the sick man of Europe. France's bond market is

EUR/USD remains under pressure, near the 17-month low of 1.1161 reached on Monday. The pair has lost more than 7% since its yearly peak, as concerns over France's public finances increasingly weigh on the single currency. But behind the weakness of the Euro (EUR), the problem does not necessarily lie with the European economy as a whole.