Technical Update - Natural Gas prices collapsing breaking key supports. Carbon Emission warming up for another sell-off
Kim Cramer Larsson
Technical Analyst, Saxo Bank
Dutch TTF GAs is breaking below key support at €125 in a total collapse. Henry Hub Gas eyeing Shoulder-Head-Shoulder target at $5.32. Sideways trading Carbon Emission could break deadlock and drop further
Dutch Gas is collapsing. After closing below €145 the big test was 125. Gas has now broken below that minor support right at the open this morning supporting the view that Dutch Gas prices are collapsing. There is no strong support in Dutch Gas before around 83.75 -77.30.
RSI is below 40 adding to the bearish picture.
Dutch could bounce and perform a minor correction from the falling lower trendline in what looks like a steep falling wedge pattern.
To reverse this bearish picture Dutch Gas needs to close above 175.
Henry Hub Gas closed yesterday below key support at $6.30 and could be in free fall to July lows around 5.32. Henry Hub would then have reached its Shoulder-Head-Shoulder target illustrated by the two vertical arrows.
To reverse this continued bearish picture Henry Hub Gas must close above 7.20.
Carbon Emission has been stepping sideways for several weeks by now. However, that might soon change. Emission prices are likely to resume down trend if it breaks below 65 followed by RSI closing back below 40. RSI is showing bearish sentiment and currently testing its lower corrective rising trendline.
For Carbon Emission to reverse the downtrend a close above 71.36 is needed.
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