EIA Natural Gas Report Reveals A Surprise Storage Draw

On August 15, 2024, EIA released its Weekly Natural Gas Storage report. The report indicated that working gas in storage decreased by 6 Bcf from the previous week, compared to analyst consensus of +43 Bcf.

At current levels, stocks are 209 Bcf higher than last year and 375 Bcf above the five-year average for this time of the year. High storage levels have served as one of the key bearish catalysts for natural gas in recent months.

The price of natural gas  moved higher as traders reacted to the bullish report. The difference between the actual numbers and analyst expectations is significant, so natural gas has a solid chance to gain upside momentum.

Traders will also focus on weather forecasts, which indicate that demand for natural gas could be high in the upcoming days. Favorable weather may provide additional support to natural gas markets.

From the technical point of view, natural gas is trying to settle above the strong resistance level at $2.25 – $2.30. RSI is in the moderate territory, so there is plenty of room to gain momentum. If natural gas settles above the $2.30 level, it will head towards the next resistance, which is located in the $2.45 – $2.50 range.

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