Natural gas could be in for a reversal from its slide as price appears to be forming a double bottom on its 1-hour chart. Price has yet to break past the neckline around $2.900 to confirm that a rally is in the works.

Technical indicators are suggesting a continuation of the slide, though, as the 100 SMA is below the 200 SMA. The gap between the moving averages is also widening to reflect strengthening selling pressure, and price is trading below both indicators so these could hold as moving averages.

Stochastic seems to be topping out before reaching the overbought zone, suggesting that sellers are eager to return. RSI is also heading lower halfway on its move up to signal a potential pickup in bearish momentum. A break below the recent lows at the $2.800 area could confirm a continuation of the downtrend.

Natural gas has been on weak footing, despite stronger demand for heating commodities and crippled supply levels on account of the winter storms. As it turns out, shipments are also being delayed due to the weather, keeping purchases in check.

The upcoming inventory report from the Department of Energy could determine whether or not the commodity is in for a reversal. Another large draw could confirm that demand stayed supported and that oversupply is not an immediate concern. A surprise build, on the other hand, could mean more losses for natural gas since it would suggest that purchases remain weak or that a glut could be imminent.

The NFP release on Friday might also impact commodity prices overall as this report tends to affect market sentiment. Strong readings could underscore an ongoing economic recovery, which would be bullish for riskier assets like commodities, while weak data could bring risk-off flows back in.