- Natural Gas Price extends rebound from 21-DMA to print mild gains above the key Fibonacci retracement support.
- Upbeat RSI adds strength to the bullish bias about XNG/USD but multiple hurdles prod further upside.
- Natural Gas sellers need validation from one-month-old previous resistance line to retake control.
Natural Gas Price (XNG/USD) remains on the front foot at around $2.73 during Tuesday’s Asia session, defending the previous day’s rebound from the 21-DMA support. In doing so, the energy instrument remains firmer past the 61.8% Fibonacci retracement level of its March-April downturn.
Apart from the sustained recovery from the 21-DMA, as well as the successful trading beyond the 61.8% Fibonacci retracement, also known as the golden ratio, the XNG/USD price also benefits from the firmer RSI (14) line, not overbought.
As a result, the commodity price is likely to challenge the monthly high of around $2.78 before targeting May’s peak surrounding $2.82.
However, an upward-sloping resistance line from mid-March and the previous monthly top, respectively near $2.87 and $2.93, will check the Natural Gas buyers afterward.
Even if the XNG/USD remains firmer past $2.93, the $3.00 psychological magnet and March’s peak of around $3.08 could test the bulls before giving them control.
Alternatively, the Natural Gas Price remains on the bull’s radar unless providing a daily closing beneath the 61.8% Fibonacci retracement level and the 21-DMA, close to $2.71 and $2.66 in that order.
In a case where the XNG/USD drops beneath $2.66, the 50% Fibonacci retracement level and the resistance-turned-support line stretched from late June, around $2.60 and $2.52 respectively, will test the commodity bears.
Natural Gas Price: Daily chart
Trend: Limited upside expected