Technical Analysis Natural Gas For July 29, 2016

Natural gas prices soared on Thursday following a report from the Department of Energy that revealed a smaller than expected build in natural gas inventories.  Prices jumped to a fresh 3-week high and are poised to test the June highs near 3 per mmbtu.  Support is seen near the 10-day moving average near 2.74.  Momentum has turned positive as the MACD (moving average convergence divergence) index generated a buy signal.

According to the EIA, working gas in storage was 3,294 Bcf as of Friday, July 22, 2016. This represents a net increase of 17 Bcf from the previous week, which compares to the 35 Bcf increase expected. Stocks were 436 Bcf higher than last year at this time and 524 Bcf above the five-year average of 2,770 Bcf. At 3,294 Bcf, total working gas is above the five-year historical range.