Technical Analysis #C-NATGAS : 2020-02-18

Recommendation:

Strong Buy
Strong SellSellNeutralBuyStrong Buy

Above 1,91

Buy Stop

Below 1,75

Stop Loss

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Senior Analytical Expert
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IndicatorValueSignal
RSI Buy
MACD Buy
Bollinger Bands Buy
Fractals Buy
MA(200) Neutral
Parabolic SAR Buy

Chart Analysis

IFC Markets Tech Analysis

On the daily timeframe, the NATGAS: D1 breached up the line of the downtrend. Now it is correcting up from its 4-year low. A number of technical analysis indicators formed buy signals. The bullish momentum may develop in case NATGAS rises above its last high at 1.91. This level may serve as an entry point. The initial stop loss may be placed below the last fractal low, the 4-year low and the Parabolic signal at 1.75. After opening the pending order, we shall move the stop to the next fractal low following the Bollinger and Parabolic signals. Thus, we are changing the potential profit/loss to the breakeven point. More risk-averse traders may switch to the 4-hour chart after the trade and place there a stop-loss moving it in the direction of the trade. If the price meets the stop level (1.75) without reaching the order (1.91), we recommend closing the position: the market sustains internal changes that were not taken into account.

Fundamental Analysis

Qatar postponed the implementation of the project to increase the capacity of its LNG terminals. Will the NATGAS rise?

Earlier, Qatar Petroleum, a state-owned company of Qatar, planned to start expanding liquefied natural gas terminals by 60% in 2020, and by 2027 to 126 million tons per year. The cost of the project was estimated at approximately $60 billion. Its implementation has been postponed because of the decline in world gas prices amid the coronavirus infection in China. Amid this, LNG exports from the US are rising. In 2018, it increased by 53%, and in 2019 – by 68%. In 2020, an increase of another 33% is projected. A cold snap is expected in the US at the end of February, which may increase short-term demand for gas for heating.

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