Natural Gas News: Futures Climb Toward $3.73 as Heat and EIA Report Drive Market Today

Natural Gas Futures Eye $3.70–$3.80 Zone as Heat Builds and Traders Brace for EIA Report

U.S. natural gas futures continued to gain early Thursday, with bulls pressing for a fifth win in six sessions and marking six straight days of higher highs.

Strong weather-driven buying and firm technical momentum have pushed the front-month August contract toward a key resistance cluster near $3.70 to $3.798—levels that align with the 50%, the 50-day moving average, and the 200-day moving average.

Is Hotter Weather Enough to Extend the Rally?

Forecast models remain in alignment on increasingly hot conditions for the second half of July, particularly across the eastern two-thirds of the U.S. NatGasWeather noted that the next five days will carry solid demand due to widespread heat, while days 6–15 show a “decisively hotter” outlook.

Temperatures are expected to surge into the 90s along the East Coast and hit triple digits in California and the Southwest, with modest cooling only in the northern third of the country.

These heat-driven forecasts are boosting near-term demand expectations for electricity generation, increasing the call on gas-fired power.

On Wednesday, August Nymex natural gas settled up $0.028 (+0.79%) at a new two-week high. The rally has been fueled by stronger air conditioning load and steady LNG exports, which climbed slightly to 15.1 bcf/day, according to BNEF.

Can Traders Trust the EIA Storage Signal This Week?

Attention is now turning to Thursday’s EIA storage report for the week ended July 11, which is expected to show a +45 bcf injection—above the five-year average of +41 bcf.

However, analysts are treating the print as “tricky,” factoring in distortions from the Fourth of July holiday and weaker wind generation. Last week’s inventory build of +53 bcf was bullish, falling below expectations and aligning with seasonal norms.

Despite recent draws, U.S. storage levels remain comfortable—6.1% above the five-year average as of July 4—even as inventories track 6.0% below year-ago levels. European storage stands at just 61% capacity, under its 5-year norm of 71%, keeping a floor under global gas demand sentiment.

Will Resistance Near the 200-Day Moving Average Cap This Rally?

With momentum building, natural gas bulls are pressing toward technical resistance between $3.70 and $3.798. However, this zone could attract fresh short interest from traders who typically fade rallies at major moving averages.

The short-term forecast leans cautiously bullish, supported by a strong weather-driven demand outlook, firm LNG flows, and recent upside momentum. But with speculative longs crowding the trade and technical resistance looming, a pullback remains a real risk if the EIA report surprises to the upside on inventories.

Traders should monitor the $3.730–$3.798 zone closely for signs of exhaustion or breakout strength.