In our previous Elliott Wave update on First Trust Natural Gas ETF ($FCG), we highlighted the blue box area at 26.20–22.77 as the next important support zone where the ongoing correction from the April 2025 cycle could end. Since then, price has reached that area, and as expected, buyers have entered and triggered a reaction higher.
This price action confirms that the blue box once again worked as a high-frequency reaction zone. As a result, the correction appears to have found support in the expected area, and the ETF is now starting to recover from that low.
Blue Box Area Was Reached as Expected
In the prior outlook, $FCG was viewed as pulling back in a 7-swing correction against the larger bullish sequence from the 2020 low. The key support came in at 26.20–22.77, and that was the area we identified as the preferred buying zone.
Now, that support area has been tested. More importantly, buyers responded once price entered the blue box, and the ETF has already started to move higher. Therefore, the market has respected the blue box setup exactly as anticipated.
Buyers Entered and Reaction Higher Is Underway
The reaction from the blue box confirms that selling pressure started to fade in the support zone and that buyers stepped back in. This is exactly the type of behavior we look for when a corrective structure reaches an extreme area.
Because the reaction is already in place, longs from the blue box area can now begin managing risk more aggressively. In other words, buyers can start looking to get risk free while allowing the upside reaction to continue unfolding.
What Comes Next for $FCG
According to the updated chart, the next path favors a 5-wave move higher from the blue box low. In other words, the current bounce is expected to develop into an impulsive advance rather than just a small random rebound.
After that initial 5-wave rally, $FCG is expected to see a pullback, which should remain corrective. Then, once that pullback finishes, the ETF can resume higher again and continue the larger recovery.
So the preferred sequence from here is:
- 5 waves up from the blue box low
- A corrective pullback
- Another leg higher
This structure would fit well with the idea that the correction has already ended and that $FCG is now trying to resume the broader bullish path.
Bigger Picture Remains Constructive
The broader outlook still supports the view that $FCG has been building from the larger bullish sequence that started from the 2020 lows. Although the ETF corrected the cycle from April 2025, the decline remained corrective and eventually found support in the blue box.
Now that buyers have reacted from that area, the focus shifts from downside risk to how the next advancing sequence develops.
Technical Summary
To summarize, $FCG reached the blue box area at 26.20–22.77, where buyers entered as expected and triggered a reaction higher. This confirms that the correction likely found support in the projected buying zone.
From here, the preferred path calls for a 5-wave move up, followed by a pullback, and then more upside as shown in the chart.
