Natural Gas Price Analysis: XNG/USD bounces off key support to reclaim $2.60 ahead of Fed inflation

Natural Gas Price picks up bids to recover from weekly low, snaps two-day losing streak.
Two-month-old rising support line prods XNG/USD bears as US Dollar stabilizes ahead of Core PCE Price Index data.
50-DMA, steady RSI also favor Natural Gas recovery as market awaits Fed’s preferred inflation gauge.
Five-month-old horizontal resistance, descending trend line from March appear strong challenges for the XNG/USD bulls.

Anil Panchal FXStreet

Natural Gas Price (XNG/USD) clings to mild gains around $2.63 during the mid-Asian session on Friday. In doing so, the XNG/USD prints the first daily gains in three while bouncing off the weekly low.

That said, the energy instrument dropped the most in more than a fortnight the previous day amid the broad US Dollar strength.

The XNG/USD downside, however, failed to conquer an upward-sloping support line from late May, around $2.58 by the press time.

It should be noted that the steady RSI (14) and the 50-DMA challenge the Natural Gas sellers unless the quote provides a daily closing beneath the $2.56 level.

Following that the 38.2% Fibonacci retracement of the March-April downside, near $2.48, will be in the spotlight before directing the XNG/USD bears toward the previous monthly low surrounding $2.17.

On the contrary, the 61.8% Fibonacci retracement level of $2.71 guards the immediate upside of the Natural Gas price ahead of a five-month-old horizontal resistance surrounding $2.78.

Even if the XNG/USD crosses the $2.78 hurdle, a downward-sloping resistance line from March, close to $2.89 by the press time, will act as the last defense of the bears.

Natural Gas Price: Daily chart

Trend: Limited recovery expected

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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