Natural gas futures (November delivery) are on track for their biggest weekly loss since June after the negative gap below the 2022 support trendline exacerbated the seven-week sell-off.

The bears are currently looking to downgrade the medium-term outlook to negative below June’s floor of 5.31. If they succeed, all the attention will turn to the crucial 4.85-4.65 region, where the price peaked several times over the past decade. Should downside pressures persist, support could next occur within the 4.30-4.00 constraining area.

Alternatively, an upside reversal may initially retest Thursday’s bar of 5.54 before heading for the 6.00 round level. Even higher, the 20-day simple moving average (SMA) and the broken ascending trendline at 6.40 could prevent any extensions towards the 200-day SMA at 6.75.

Note that the RSI has dipped in the oversold zone, testing its 2020 low, while the stochastics oscillator is also fluctuating near its previous lows in the oversold territory, both increasing the odds for a bullish correction or some stabilization.

In the big picture, a sharp rally is required above the 10 number to put the market back on the positive trajectory. Though, that almost looks impossible to happen in the near term as the price is currently trading far below that threshold.

In short, natural gas futures are exposed to an outlook deterioration in the short- and medium-term timeframes. If the price fails to set a foothold around 5.30, the downtrend could gain extra legs.