Technical Natural Gas report for August 24, 2016.

Natural gas prices surged on Tuesday following a forecast from the Nation Oceanic Atmospheric Administration that showed the weather throughout most of the United States would be warmer than normal. Warmer weather generates additional cooling demand from electricity which is generated through consumption of natural gas.  Resistance is now seen near a downward sloping trend line that comes in near 2.79.  Support is now seen near the 20-day moving average which was former resistance now support at 2.738.

Momentum on natural gas prices has turned positive as the MACD (moving average convergence divergence) index generated a buy signal. This occurs as the spread (the 12-day moving average minus the 26-day moving average) crosses above the 9-day moving average of the spread. The index moved from negative to positive territory confirming the buy signal. The upward trajectory of the MACD points to higher prices.