Natural Gas Price Prediction – Prices Continue to Form Bear Flag Pattern

Natural gas prices rebounded for a third consecutive trading session and form a bear flag pattern. This is a pause that refreshes lower. This followed an inline inventory report from the Department of Energy. The weather in the mid-West is expected to be much, much warmer than normal near record highs, and the rest of the country is also expected to see warm weather conditions.

Technical Analysis

Natural gas prices formed a bull flag pattern that is pause that refreshes lower. Momentum is negative as the MACD (moving average convergence divergence) histogram is printing in negative territory with a downward sloping trajectory which points to lower prices. Prices are oversold. The fast stochastic is printing a reading of 10, well below the oversold trigger level of 20. Short-term momentum is positive as the fast stochastic generated a crossover buy signal.

Natural gas in storage was 3,505 Bcf as of Friday, December 3, 2021, according to the EIA. This represents a net decrease of 59 Bcf from the previous week, which was in line with expectations. Stocks were 356 Bcf less than last year at this time and 90 Bcf below the five-year average of 3,595 Bcf. At 3,505 Bcf, total working gas is within the five-year historical range.