Natural gas could be poised for a reversal from its downtrend as it breaks out of the descending channel on the 1-hour time frame. Price is also starting to climb past the 100 SMA dynamic inflection point to confirm bullish pressure.

On the subject of moving averages, the 100 SMA is still below the longer-term 200 SMA to confirm that the path of least resistance is to the downside. In other words, the downtrend is more likely to resume than to reverse. Then again, the gap between the two is narrowing to reflect slowing bearish momentum. Price could aim for the 200 SMA dynamic resistance at 3.200 next.

RSI is heading higher so price could follow suit while bulls have the upper hand. However, this oscillator is dipping into the overbought region to signal exhaustion and a possible return in selling pressure. Stochastic has a bit more room to climb so price could keep pushing for gains until overdone conditions are seen.

Sentiment is improving in the general financial markets, which may be why commodities are able to cash in more gains. A slightly more dovish tone struck by Fed head Powell is being touted as the primary catalyst for the risk rallies. After all, the likelihood of keeping borrowing costs low for much longer could prove positive for business activity and energy demand.

Apart from that, positive expectations for the US-China mid-level trade talks are also fueling risk appetite. More progress after the previously announced 90-day truce on tariffs could buoy higher-yielding assets higher on expectations that the measures could someday be lifted. On the other hand, signs that tensions have a long way to go before ebbing could bring risk aversion back to the table.

Other factors that could push natural gas price around in the coming days are US oil inventory levels that could give a gauge of energy demand in the country.