Natural Gas News: Secondary Higher Bottom in Play if $2.947–$2.887 Zone Holds

U.S. Natural Gas Holds Flat as EIA Storage Tops Estimates but Bullish Setup Remains in Play

U.S. natural gas futures traded flat on Thursday as traders absorbed a slightly larger-than-expected build in storage reported by the EIA. Despite the neutral price action, technical levels and shifting fundamentals suggest the market is entering a critical decision zone, with traders closely watching whether recent short-covering will transition into genuine buying.

At 14:50 GMT, Natural Gas Futures are trading $2.983, down $0.046 or -1.52%.

EIA Storage Build Tops Forecast, But Misses Bullish Expectations

The Energy Information Administration (EIA) reported a +71 Bcf injection for the week ending September 5, exceeding survey estimates of +68–70 Bcf and notably above the five-year average build of +56 Bcf. While the figure beat consensus, it came in just above NatGasWeather’s expected “slightly bullish” +67 Bcf. Cooler-than-normal weather over the eastern U.S. and record-low wind generation contributed to the tight expectations, but the final build underwhelmed bulls hoping for a lower number.

Total working gas in storage now stands at 3,343 Bcf, 188 Bcf above the five-year average and 38 Bcf below year-ago levels. Storage remains well within historical norms, suggesting no immediate supply concerns, though the margin over the 5-year average is narrowing slowly.

Technical Levels Show Market at a Crossroads

Natural gas prices are hovering just below key resistance at the 50-day moving average of $3.200 and a short-term pivot at $3.238. A confirmed breakout above $3.238 could trigger an acceleration toward $3.579, a level with few obstacles in between. However, recent gains from $2.695 to $3.198 appear largely driven by short-covering, not fresh buying interest. This suggests the market may need a pullback into a stronger support zone before any sustainable rally.

On the downside, support lies in the retracement zone between $2.947 and $2.887. A move into this range, followed by renewed buying, could result in a secondary higher bottom—potentially positioning the market for a retest and breakout above $3.238. If $2.887 fails, however, look for a sharp decline back toward the $2.695–$2.647 major support area.

Weather Outlook Supports Limited Near-Term Demand

Short-term weather forecasts project low demand for the next three days, with high pressure dominating the North and extreme heat in the South. Demand is expected to rise to moderate levels afterward. While this isn’t a bullish demand setup, it may be enough to support prices if technical support holds and new buyers step in.

Market Forecast: Cautiously Bullish with a Key Support Test Ahead

Natural gas remains technically neutral but sets up for a potential bullish breakout if it pulls back to $2.947–$2.887 and attracts fresh buying. If support holds, a challenge of $3.238 remains on the table. A break below $2.887, however, would flip the outlook bearish quickly. Traders should watch for price action around these key levels before positioning.

More Information in our Economic Calendar.