Structural Breakdown Levels and Deeper Targets
Moreover, a decisive decline below that line will show weakness. That would also further confirm a bearish reversal signal for the long-term uptrend on a move below the August swing low. An eventual test of support would then extend down to a range from around $2.30 to $2.21. That range combines a swing high and swing low, respectively. There is also a rising channel line added that shows a 50% downside extension of the original channel.
Long-Term Trend Signals Continue to Deteriorate
Recent long-term bearish signals for natural gas have been accumulating, with the developing pattern further confirming earlier signals. In February, the long-term uptrend support line was broken, quickly leading to a break below the higher swing low of $3.01 from January. Subsequent strength was met with resistance near key levels and indicators, including the 200-day average. Then last week the interim higher swing low from September was broken to the downside, along with the prior trend low of $2.78 from late-February being broken.
Overall, price action now returns to a critical decision zone at $2.62, where either stabilization or breakdown will likely define the next major directional phase of a long-term trend.
