Natural Gas News: Futures Test Key $3.361 Support as Bearish Forecast Builds

Natural Gas Futures Hold Key Support, but Downside Risks Mount

U.S. natural gas futures hovered near $3.361 late Friday, a pivotal support level keeping prices afloat following a broader sell-off across energy markets. Although the level held into the close, the failure to push above short-term resistance leaves the market exposed to a potential drop toward technical targets near $2.995 and $2.887. With fundamentals offering limited support and macroeconomic risks back in play, traders are closely eyeing this consolidation zone for directional clues.

Is $3.361 the Last Line of Defense for Bulls?

Prices have struggled to sustain gains, repeatedly failing to clear the 50-day moving average at $3.894 and the short-term pivot at $3.935. Without a fresh bullish catalyst, this ceiling appears intact for now. The key $3.361 level has acted as a short-term floor, but technical momentum suggests any breakdown here could send prices toward the 61.8% retracement at $2.995 and the 200-day moving average at $2.887—an area that may finally attract meaningful buying interest.

Weather Support Fades with Mixed Forecast

The short-term weather outlook offers only modest demand support. NatGasWeather reports a late-season chill pushing through the Great Lakes and East, with overnight lows in the 20s-30s. However, mild to warm conditions persist across the West, South, and Central U.S., with highs reaching the 50s to 90s. With this mix, demand is projected to remain moderate over the next seven days—insufficient on its own to drive a bullish breakout.

Storage Build Confirms Weak Shoulder Season Demand

Thursday’s EIA report showed a storage injection of 57 Bcf, aligning with consensus estimates of 55–56 Bcf. This build was significantly above the five-year average of +17 Bcf, underscoring muted residential and commercial demand. Total working gas in storage now stands at 1,830 Bcf—40 Bcf below the five-year average and 450 Bcf less than this time last year. While slightly tighter year-on-year, the surplus over five-year norms has evaporated, offering limited fundamental upside.

Will Macro Fears Drag Prices Lower Again?

Beyond domestic fundamentals, traders remain wary of broader risk-off sentiment, including renewed fears tied to the U.S.-China trade war. A breakdown in energy sector sentiment pressured natural gas alongside crude on Friday, suggesting further downside if macro headwinds intensify.

Market Forecast: Bearish Bias Below $3.361

Unless bulls defend $3.361 with conviction, natural gas futures are likely to probe lower technical levels. With no immediate weather or storage support and resistance levels still capping rallies, the short-term bias leans bearish. A move toward $2.995 could attract bargain hunters, but until then, sellers appear in control.

More Information in our U.S. natural gas futures.