Natural gas markets are experiencing a significant downturn on January 28, 2025, driven by a combination of technical factors and weather forecasts. The rollover into the March contract has seen natural gas prices drop sharply, with pre-market trading showing a 3.76% decline. This decline is attributed to the market's approach towards the $3.50 level, a previously resistant area now expected to act as support. However, the presence of the 50-day EMA in this region raises questions about the sustainability of this support. Additionally, meteorologists are predicting warmer-than-usual temperatures in February, which could further dampen demand and potentially signal the end of the winter rally for natural gas.
The ProShares UltraShort Bloomberg Natural Gas ETF (KOLD) has responded to these market conditions by rising to $37.77, marking a 4.52% increase from the previous close.