Natural Gas Futures Face Renewed Bearish Pressure After Decade-Long Downtrend
Natural gas futures are exhibiting signs of weakness, potentially poised for further declines after a period of tentative gains. A recent analysis of market movements since August 25, 2025, reveals a persistent bearish trend fueled by declining demand and key technical indicators suggesting continued downward momentum.
The current situation builds upon a long-term bearish cycle. Futures have remained below the 200-day moving average (DMA) since January 2014, following a peak of $6.499 in February of that year. This extended selling pressure pushed prices below the 200-day exponential moving average (EMA), solidifying the bearish outlook as the 9 EMA, 20 EMA, 50 EMA, and 100 EMA all moved below the 200 EMA.
Attempts to break above the 200 EMA have been short-lived. A brief rally in November 2018, which saw prices reach $4.935, was quickly reversed in December, pushing futures down to a low of $2.939. This selling continued until June 2020, when prices bottomed out at $1.432 before a subsequent rally extended into September 2021, reaching $6.280. However, selling resumed from October 2021 through December 2021, though futures managed to stay above the 200 EMA, which stood at $3.654 at the time.
Further bullish momentum emerged in January 2022, with futures peaking at $7.416, and successfully closing the month at $4.881 while remaining above the 200 EMA. This upward trend culminated in a peak of $10 in August 2022, with a monthly low of $7.541. However, September 2022 brought another wave of selling, driving futures back below the 200 EMA by January 2023.
Since then, natural gas futures have largely remained below this key resistance level. A breakout occurred in October 2025, but it was notably achieved despite a 43-day government shutdown from October 1 to November 12, 2025, which limited the availability of crucial market data. “The absence of relevant data during the shutdown raises questions about the validity of the October breakout,” one analyst noted.
Despite briefly testing a high of $5.495 in December 2025, a subsequent low of $3.800 casts doubt on the strength of the recent rally. The bullish moves observed in October and November 2025 appear “hollow,” driven primarily by momentum rather than fundamental support.
Looking ahead, the analysis suggests potential for further losses. If the current month’s candle closes below $4.530, significant bearish pressure could push futures back below the critical support level of the 200 EMA, currently at $3.262. A sustained move below this level could extend the bearish territory through June 2025.
Disclaimer: Readers are advised to take any position in natural gas futures at their own risk, as this analysis is based only on observations.
