UKNatgas:Winter is coming, the Strait of Hormuz is still closedUK NBP Natural Gas FuturesICEEUR_DLY:GWM1!Kearabilwe-NonyanaIt can be argued that UKNatural Gas is one of the best fundamental-backed commodities in Europe's energy markets today and the daily chart is finally showing it through technical analysis that needs to be taken into consideration. The price is 75.67% higher on an annual basis, and the fundamentals behind this performance are just the same as they were yesterday. Tehran and Muscat have failed to reach any agreement on the Strait of Hormuz after the weekend meeting broke down again – Tehran made a long list of demands to Washington as a condition for fully reopening the strategically important strait and refused to negotiate directly with the United States while at the same time limiting ships from both the US and Israel to use it.The effect of this diplomatic gridlock is clear and quantifiable; shipments of LNG from Qatar, one of the biggest exporters in the world, have been delayed and diverted; Asian buyers are battling with their European counterparts for each cargo they can get their hands on; and the stockpiling effort in Europe has failed to meet its target for entering the winter heating season in comfort. "A substantial shock," according to the Bank of England, will hit the UK economy from the Middle East conflict. The IMF lowered the UK growth forecast due to the Iran war inflation. And with August normally a crucial month for injecting gas into the storage facilities in Europe falling victim to supply shortages, the market is slowly pricing in a winter season that might again be structurally under supplied for the second year in a row. The market is at 149.72 pence; not panic, but methodical construction towards a reality. However, this trade looks good in the fundamentals and technicals in the daily chart since what price action has done is to form within the price structure from July to August what is known as a W formation, or double bottom, more technically speaking. There was indeed a W formation bottom at approximately 128-130 pence in late July, where the initial wave of Hormuz optimism due to the temporary peace agreement had caused price weakness. Then, there was a bottom in early August to 128 pence before the problems in diplomacy led to supply concerns and a 4.87% increase in price on just one trading day. The neckline at 155 GBp marks the key resistance and measured move trigger. Once a close above this level occurs, then it signals the completion of the W pattern with a price objective of 180-185 pence. The technical case is indeed strong since the TEMA 9 at 144.84 pence marks dynamic support. Moreover, the 50-day and 200-day EMAs show strong institutional momentum. In addition, the RSI reading of 62.15 leaves a lot of room before overbought conditions occur. Furthermore, the MACD's slightly negative histogram is a classic signature of a double-bottom completing, signaling the setup is primed for a bullish breakout. Trade recommendation Direction: Long Entry horizon: 145 – 152 pence Primary target: 155 pence Secondary target: 165 pence Stop loss: Daily close below 128 pence Technical scenarios Hormuz remains closed : The diplomatic deadlock between Tehran and Washington intensifies as Iran’s conditions remain fundamentally irreconcilable with the framework proposed by US and Omani mediators. European utilities, already trailing the necessary pace for winter stockpiling, find themselves forced into aggressive bidding for Atlantic Basin LNG cargoes against fierce competition from Asian buyers. Technically, the RSI surges above the 70 threshold for the first time since July, while the TEMA 9 converges with price action as momentum enters controlled acceleration. The W pattern neckline at 155 GBp yields on a daily closing basis;decisively confirming the structural breakout and projecting a measured move toward the 180–185 pence corridor. This technical surge aligns with the seasonal demand pivot traditionally seen in late August, as the market begins to price in final winter positioning before the heating season commences. Consolidation before the winter seasonal bid: The market methodically digests the 4.87% Monday spike, trading sideways within the 145–155 pence range the zone defined by the right leg of the W and the immediate neckline resistance. During this phase, the RSI cools from 62 toward 55 and the TEMA 9 gradually aligns with price; this is not a trend reversal, but rather the textbook signature of a market absorbing sharp gains before the next catalyst. The technical integrity of the W pattern remains perfectly intact, with the 128 stop level unchallenged. This consolidation is anchored by the fundamental seasonal demand narrative, which continues to attract buyers on every intraday dip, making the 145–152 GBp entry zone a compelling reload opportunity. Hormuz breakthrough unwind: In this lower-probability scenario, Iran and Oman secure a framework agreement that facilitates a resumption of partial LNG transit through the Strait of Hormuz, effectively stripping away the acute supply premium that has underpinned the European gas complex since June. Such a shift would trigger a sharp RSI reversal from 62 toward 45, placing the W pattern’s right trough at 128 under immediate threat. A daily close below this floor would invalidate the bullish technical structure entirely. Given that this outcome necessitates a major shift in Iranian domestic policy or a significant US sanction concession currently ruled out by the administration, it remains the outlier scenario; however, it defines the essential stop loss trigger should the fundamental reality pivot.