Natural gas seems to have completed its retest of the area of interest on its 4-hour time frame, and price is setting its sights on the upside targets marked by the Fibonacci extension tool.

The 38.2% level is close by at $3.317, which lines up with the swing high. Stronger bullish pressure could take natural gas up to the 50% level at $3.377 or the 61.8% level at $3.438. The 76.4% level is at $3.512 then the full extension is at $3.633.

The 100 SMA is above the 200 SMA to indicate that the path of least resistance is to the upside or that more gains are in the cards. The 100 SMA also recently held as dynamic support on the dip.

Stochastic is in the overbought zone to signal exhaustion among buyers, and turning lower would mean that sellers are regaining the upper hand. RSI is also heading up to suggest that bullish pressure is present, and the oscillator has room to climb before reflecting overbought conditions.

Natural gas could keep drawing support from warmer weather conditions, as this props up demand for heating commodities. With that, forecasts of higher temperatures ahead could keep prices afloat.

The upcoming inventory report from the Department of Energy would shed more light on market conditions, as another larger than expected draw could bring more upside for the commodity. A surprise build, on the other hand, could spur a larger dip for natural gas.

There are no major catalysts that might spur a huge swing in market sentiment these days, although it’s still worth noting that the Fed shifted to a slightly more hawkish bias in their latest policy statement.

This could mean an earlier increase in borrowing costs than initially expected, possibly keeping a lid on business and consumer activity. In turn, this could dampen demand for higher-yielding assets like commodities.