Commodities Analysis & Opinion

Gold and Natural Gas to Take Opposite Paths Going Forward

 

On March 1st, the movement of gold and natural gas futures appear to have behaved similarly on a 15-minute chart since they both tested their lows on February 28th. However, they seem poised to take opposite directional moves soon.

Undoubtedly, gold and natural gas futures have different characteristics and underlying causes behind the behavioral patterns which are presently causing uncertainty among traders. The current international geopolitical climate is continuously evolving, adding to the complexity of the situation.
Natural Gas 15-Minute Chart

Gold Futures 15-Minute Chart

Despite exhibiting signs of weakness, both commodities currently have a significant presence of both bullish and bearish market participants at their current price levels. However, it appears that neither side is willing to engage in aggressive trading and attempt to force the price in their favor at this time.

Gold futures hit a low at $18,11.54 on Feb. 24 amid growing skepticism over the Fed’s next move on Mar. 22 which is likely to increase volatility amid increasing uncertainty over the Russia-Ukraine war which seems to make less effective inflation control strategies by global central banks.

Natural gas futures have reason to remain volatile as bulls and bears continue their intense tug-of-war. Both sides have their own reasons for remaining active, including the potential opening of the Freeport facility and unpredictable weather patterns.

Both commodities could see decisive moves on Mar. 2 as the closing on the first day of March looks full of uncertainty as natural gas futures try to find a breakout above the immediate resistance at $2.888, while gold futures wait for a breakout above the significant resistance at $1,853.

Nobody knows exactly the next directional moves by both commodities this week as these moves could be one-sided, depending on who wins the battle at this crucial point.

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