Energy markets Poised for Shift? Oil and Gas Watch for Key Technical Signals
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despite the recent surge in popularity of choice energy sources, customary fossil fuels might potentially be setting the stage for a comeback. While stocks and ETFs focused on nuclear, coal, solar, and hydrogen have performed well, more established energy resources have lagged behind.However, a growing sentiment – “All energy hands on deck” – suggests a potential turning point, especially given the current low prices of oil and gas futures.
The 50-Day Moving Average: A Critical Threshold
Market observers are closely monitoring key technical indicators to determine if a trend reversal is underway. Specifically,the 50-day moving average (DMA) is emerging as a crucial level for both oil and natural gas. According to one analyst, “waiting for two consecutive closes over the 50-DMA” is the key to confirming a bullish shift in oil, and a bottom for natural gas.
The United States Oil Fund (USO) provides a compelling case study. Since the end of August,the ETF had failed to achieve two consecutive closes above the 50-DMA. This pattern, the analyst explains, is a valuable confirmation tool, avoiding the false signals often generated by single-day price fluctuations. “Two-day closes avoid whipsaws,” they noted, emphasizing that sustained buying pressure is needed for a reliable trend shift.Importantly, USO did close back over the 50-DMA today, making the closing price on the 24th a pivotal moment. Confirmation with another close above the DMA would signal a perhaps sustainable trend change.
Natural Gas: Testing Resistance
The United Natural Gas Fund (UNG) presents a different scenario. Since June 2025, the ETF has consistently faced resistance at its 50-DMA, acting almost as a trendline. A rally on September 17th brought the price close to the moving average, but ultimately failed to break through.
Key Support Levels Across Major ETFs
Beyond oil and natural gas, several other ETFs are exhibiting important support levels. Here’s a snapshot of key areas to watch:
- S&P 500 (SPY): 660 support
- Russell 2000 (IWM): 240 close support
- Dow (DIA): 461 support
- Nasdaq (QQQ): 592 support
- Regional banks (KRE): 63 huge support
- Semiconductors (SMH): 310 support
- Transportation (IYT): 70 huge support
- Biotechnology (IBB): 140 pivotal
- Retail (XRT): 87 pivotal
- Bitcoin (BTCUSD): 110k closest support
Ultimately,the coming days will be critical for determining whether the current low prices in oil and gas represent a buying possibility,or a continuation of the recent underperformance. the 50-DMA remains the key indicator to watch for confirmation of a potential shift in momentum.
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