Natural Gas Prices Rally in Sympathy with Oil

On Tuesday, natural gas prices rebounded as oil prices helped buoy the carbon commodities sector. The weather is now expected to be colder than average throughout most of the West Coast and the mid-West for the next 2-weeks. Geopolitics continues to keep LNG exports elevated as natural gas prices in Europe remain high.

U.S. total natural gas supply declines slightly this week. According to the EIA, the average total supply of natural gas fell this report week by 0.6% compared with the previous report week. Dry natural gas production decreased by 0.5% compared with the previous report week, and average net imports from Canada were essentially flat at 5.8 Bcf/d this week.

Technical Analysis

Natural gas prices moved higher on Tuesday. Support near the 200-day moving average at 4.30. Resistance is seen near the February highs at 4.94.

Short-term momentum has turned positive as the fast stochastic generated a crossover buy signal. Medium-term momentum is flat. The MACD (moving average convergence divergence) index is poised to generate a crossover sell signal. The MACD histogram is printing in positive territory with a declining trajectory that reflects consolidation.