Natural gas was previously trading below a descending trend line on its 4-hour time frame, but it looks like an upside break just took place. This could mean that a reversal from the longer-term slide is in the works.

However, the 100 SMA is still below the 200 SMA to indicate that the path of least resistance is to the downside or that the selloff is likely to resume. Price is also trading below both moving averages, so these could continue to hold as dynamic resistance levels.

Stochastic has reached the overbought zone to reflect exhaustion among buyers, and turning lower could mean a return in selling pressure. RSI, on the other hand, has room to climb so price could follow suit while bullish pressure is present.

Natural gas could simply dip to the broken trend line, which might now hold as support, and resume its reversal if fundamentals support more gains.

The upcoming inventory numbers from the Department of Energy could determine whether or not the climb could gain traction. A large reduction in stockpiles could confirm a pickup in demand due to cooler weather conditions while a build could signal potential oversupply concerns.

Risk appetite resulting from Fed policymakers’ speeches later today could also impact commodity markets, including natural gas prices. Recall that Powell previously said that there’s no need to tighten policy in order to curb the rise in bond yields, and this has been bullish for riskier assets like commodities.

Any change in tone shifting to a more hawkish view might mean some downside for natural gas, as the potential for higher borrowing costs could weigh on business and consumer activity. As in earlier weeks, any changes in weather forecasts would likely impact the outlook for heating commodity prices as well.