Technical Natural Gas report for August 26, 2016

Natural gas prices have broken out above trend line resistance following a lower than expected build in inventories reported on Thursday by the Department of Energy.  Support is now seen near former resistance at a downward sloping trend line that connected the highs in July to the highs in August and comes in near 2.85.  Resistance is seen near the August highs at 2.91.  Momentum on natural gas has turned positive as the MACD (moving average convergence divergence) index recently generated a buy signal.

According to the EIA, working gas in storage was 3,350 Bcf as of Friday, August 19, 2016. This represents a net increase of 11 Bcf from the previous week, compared to the 18 Bcf increase expected. Stocks were 275 Bcf higher than last year at this time and 350 Bcf above the five-year average of 3,000 Bcf. At 3,350 Bcf, total working gas is above the five-year historical range.