Natural Gas Price Prediction – Prices Rebound to Close in the Black

Natural gas prices rebounded from session lows and closed in the black. The weather is expected to be warmer than normal throughout most of the United States for the next 8-14 days. There are two storms currently in the Atlantic near the Caribbean that have a small chance of each becoming a tropical cyclone in the next 48-hours, according to the National Oceanic Atmospheric Administration. U.S. supply remain flat week over week.

Technical Analysis

Natural gas prices dropped early but rebounded into the close after pushing through support which is an upward sloping trend line that comes in near 5.29. Resistance is seen near 5.75. Below support is seen near the 50-day moving average at 4.69. Momentum has turned negative as the MACD (moving average convergence divergence) index generated a crossover sell signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses below the MACD signal line. The MACD histogram is printing in negative territory with a downward sloping trajectory which points to lower prices. Short-term momentum is also negative as the fast stochastic generated a sell signal.

Supply Remains Unchanged

U.S. supply of natural gas remained relatively flat this report week. According to data from the EIA, the average total supply of natural gas fell by 0.4% compared with the previous report week. Average net imports from Canada decreased by 5.8% compared with the previous report week. Dry gas production was relatively flat, falling less than 0.1%.