Energy Crisis Coming? Natural Gas (NGAS) Price Has Spiked 110%!

NYMEX Natural gas price has again surpassed $7 and may well have completed a corrective pullback from the February-April momentum and may soon be preparing to go to a multi-year high above $8.2.

Natural Gas spiked 110% from the Feb lows of $3.9 to a peak on April 18th

It spiked 110% from the Feb lows of $3.9 to a peak on April 18th, and its momentum is clearly in line with its Fibonacci retracement pattern touching 61.8% of the rally. Additionally, the bottom of the latest correction coincided with the previous price peak in October.

Renewing Natural gas growth momentum - 1

In support of a bullish scenario for gas, its price showed a more than 7% jump on Monday

This transformation of former strong resistance into support is frequent in the markets. In support of a bullish scenario for gas, its price showed a more than 7% jump on Monday, despite the decline in oil.

There is a fundamental reason for this ability to resist gravity: Europe is still looking for alternatives to Russian gas, and the first alternative is gas from the USA. Against the bullish momentum in gas, as in other commodities, a wave of selloffs of risk assets and deleveraging could play out. Already we are seeing the first signs of this in more robust demand for the yen and falling Gold while stock indices are falling.

Alex Kuptsikevich

Financial market professional with 16-years' experience and Senior financial analyst at FxPro. Author of daily reviews on the impact of economic events with comments regularly featured in top international and Russian media. Covers fundamental analysis, global markets, foreign exchange market, gold, oil, cryptocurrencies.

Alex Kuptsikevich is a regular contributor to both digital and print media including CNBC, Forbes, Reuters, MarketWatch, BBC and Coindesk.