Natural Gas News: 50-Day MA Becomes Battleground as Futures Seek Direction

Natural Gas Futures Hold Above Key Technical Support as Weather Turns Cooler

U.S. natural gas futures are ticking higher Tuesday, supported by technical buying and fresh forecasts for cooler temperatures. After successfully defending the 50-day moving average at $3.287 on Monday, prices are showing early signs of resilience.

With support now firming between $3.286 and $3.324, the market’s focus has turned to resistance near $3.441. A sustained breakout above that level could open the door toward $3.529–$3.585.

At 12:31 GMT, U.S. natural gas futures are trading $3.397, up $0.040 or +1.19%.

Will Technicals Drive the Next Leg Higher for Natural Gas Futures?

Traders stepped in Monday to defend key support, pushing November Nymex natural gas up 0.99% to $3.374. Yesterday’s low of $3.296 held just above the 50-day MA, drawing fresh buying interest.

The market is now straddling minor resistance at $3.441. A confirmed move above would signal strength and attract technical buyers, with upside targets near $3.585. If rejected, expect a return to the $3.324–$3.296 range.

Cooler Forecasts Boost Heating Demand Expectations

The bullish tone is underpinned by updated weather models showing a notable shift toward cooler conditions between October 16–20. The first strong fall front is expected to sweep the Midwest and Northeast this week, boosting heating demand.

According to NatGasWeather, the mix of heating and cooling degree days will improve, following a warmer-than-normal start to fall. The European model added several total degree days (TDDs) over the weekend, helping to lift futures early this week.

EIA Storage Data and Production Trends Send Mixed Signals

Last week’s EIA report added another layer of support, with inventories rising just +53 Bcf, well below expectations of +64 Bcf and the 5-year average of +85 Bcf. However, production remains near record highs.

Lower-48 dry gas output hit 107.6 Bcf/day Monday, up 4.9% year-on-year. LNG exports are holding firm at 15.8 Bcf/day, while domestic demand sits at 68.8 Bcf/day, essentially flat year-on-year.

Although storage levels are 5% above the 5-year seasonal average, slower builds could help tighten the balance into late October.

Will Rising Electricity Output Provide Price Support?

Electricity generation may provide a tailwind, with the Edison Electric Institute reporting a 5.96% year-on-year rise in U.S. lower-48 output for the week ending September 27. Over the past 52 weeks, output is up 2.9% year-on-year. While not a direct demand driver, this uptick reflects broader energy usage that could translate into stronger baseline gas burn.

Market Forecast: Bullish Bias Holds Near-Term

With technical support intact, cooler weather ahead, and tighter-than-expected storage builds, the near-term outlook leans bullish. A sustained break above $3.441 could unlock upside toward the $3.529–$3.585 range. Failure to clear resistance would likely lead to a retest of the $3.324–$3.296 support zone. Traders should watch weather models and EIA data closely for confirmation.

More Information in our Economic Calendar.