Natural Gas Price Prediction – Prices Eased After Boost from Inventory Report 

Key Insights

• Natural gas pulls back from this week’s highs. 
• The weather is expected to be warmer than usual throughout the South.
• Natural gas supply rose this week.

Natural gas prices traded lower, settling lower after three consecutive days of gains. According to the National Oceanic Atmospheric Administration, the weather is expected to be warmer than normal during the next 6-10 days and 8-14 days throughout most of the South.

Temperatures have been cooler in the Northwest. Inventories rose in the latest week. According to the EIA Natural Gas Storage Report, natural gas prices decline as consumption falls. This scenario comes as a result of warmer and more moderate temperatures across the United States and less heating demand. 

Technical Analysis

On Friday, natural gas prices dipped below the 10-day moving average near 7.812, extending gains for the third consecutive trading session. Target resistance is seen near the May highs at $8.99.

Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal.

Medium-term momentum has turned negative. The MACD (moving average convergence divergence) generated a crossover sell signal. This situation occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses below the MACD signal line (the 9-day moving average of the MACD line).

The MACD histogram is printing in negative territory with a downward sloping trajectory which points to lower prices.