In 4-Hour Time Frame, Details
The 4-Hour chart will be used to examine recent price movement in more detail. In this more in-depth perspective, other price levels to observe are also there or at least simpler to discern. On a clear advance over today’s high of 2.61, we can observe that this is the first indication of strength. Additionally, a breakthrough above the 55-period EMA would be caused by that move (purple line). Fibonacci retracement levels are indicated, and prior swing highs may function as a magnet to draw price even higher.
Take Care to Avoid False Breakdown
Although it wouldn’t be unexpected for buyers to enter more forcefully on early declines below the current trend low, if that were to happen, given the severe oversold level that was recently achieved (most oversold since February 2017). Explosive movements off the bottom can occur if price exhibits this undercutting (dropping below prior low) and running (turning strongly bullish after initial bear trigger to new trend low) tendency.
Since there has been constant downward pressure on natural gas, it is stated here. The price has been consolidating on the recent bottom in a constrained range for the previous eight days, so there has hardly been a bounce off it.