Natural Gas News: Bearish Forecast Builds as Sellers Eye 200-Day Average at $2.899

Natural Gas Slips Further as Market Targets Technical Support Near $2.90

U.S. natural gas futures continued their downward drift Monday, extending a five-day slide driven by persistent selling pressure and weak demand signals. Prices are now pressing into key technical territory, with traders eyeing the 61.8% retracement level at $2.995 and the 200-day moving average near $2.899 as the next critical zone.

At 11:45 GMT, Natural Gas Futures are trading $3.181, down $0.064 or -1.97%.

Is Mild Weather Setting the Tone for Softer Demand?

Warmer-than-normal conditions are dominating across major demand regions, including the East, South, and Midwest. This is dampening both heating and cooling demand, a common feature of shoulder season trading. Forecasts suggest continued above-average temperatures through late April, leaving little room for a weather-driven price rebound. Without a shift in weather conditions, consumption is expected to remain soft, increasing pressure on storage builds heading into May.

Inventory Miss Offers No Lifeline

Last week’s EIA report showed a 16 Bcf injection for the week ending April 11 — well below consensus expectations of 24 Bcf and the five-year average of 50 Bcf. Still, the miss failed to lift sentiment. Total inventories remain 20.9% below last year and 3.9% below the five-year average, but the market is clearly more focused on upcoming supply-demand conditions than backward-looking inventory surprises. Traders appear unwilling to chase upside without stronger fundamental signals.

Supply Holds Firm While LNG Remains Tepid

Production remains robust, with dry gas output in the Lower 48 above 105 Bcf/day — over 5% higher year-over-year. On the export side, LNG volumes have slipped to 15.5 Bcf/day. While domestic demand has improved slightly — up 2.2% year-over-year — the imbalance remains skewed to the downside. Gains in power sector consumption, currently up 6.4% versus last year, have not been sufficient to offset the broader oversupply.

Are Traders Positioning for a Retest of the 200-Day Moving Average?

With prices now slipping below the 50% retracement level at $3.361 and approaching the 61.8% mark at $2.995, momentum is clearly to the downside. The 200-day moving average at $2.899 is emerging as the next major decision point for technical traders. If this level fails to hold, further declines could be triggered by systematic selling and weak seasonal demand.

Market Forecast: Bearish Pressure Likely to Persist

The path of least resistance remains lower. Mild weather, firm production, and soft LNG flows are keeping the market heavy. Without a meaningful catalyst — such as a cold snap or a surge in exports — traders should expect continued downside pressure into next week.

More Information in our Economic Calendar.