Natural Gas News: Technical Chart Points to $3.823 — Will Bulls Keep Control Today?

Natural Gas Futures Extend Rally on Cold Weather Outlook and Technical Breakouts

U.S. natural gas futures extended their winning streak for a fourth straight session on Wednesday, driven by a combination of colder weather forecasts, supportive inventory data, and key technical breakouts. Traders are eyeing further upside potential as the November contract builds momentum, with short-term resistance levels increasingly within reach.

At 13:58 GMT, Natural Gas Futures are trading $3.525, up $0.051 or +1.47%.

Will Cold Weather Be Enough to Push Prices Through Resistance?

A sharper turn in weather models has significantly boosted bullish sentiment. Atmospheric G2 reported Tuesday that temperature forecasts for October 26–30 and October 31–November 4 have shifted colder across the central and eastern U.S.—a move that’s expected to increase heating demand materially in the coming weeks. This has triggered buying in the front-month contract, with November Nymex natural gas (NGX25) climbing +2.27% on Tuesday, marking a 1.5-week high.

Wednesday’s early trading pierced the October 8 high of $3.550, putting the October 2 top at $3.585 directly in focus. A confirmed breakout above this level would likely target the long-term pivot at $3.823, followed by the 200-day moving average at $4.139. Trader response to $3.585 is expected to be decisive for short-term direction.

Does Rising Production Threaten the Rally?

While the near-term setup looks bullish, the broader supply picture remains a headwind. U.S. dry gas production on Tuesday reached 104.6 Bcf/day, up 1.1% year-over-year, according to BloombergNEF. The EIA recently revised its 2025 production forecast upward to 107.14 Bcf/day, reinforcing that supply remains elevated. Active gas rigs have also climbed, hitting 121 last week—just shy of the two-year high of 124 set in August.

However, robust demand has helped offset this pressure. Lower-48 gas demand was 71.5 Bcf/day on Tuesday, up 4.9% year-over-year. LNG export flows, while slightly lower week-over-week at 15.9 Bcf/day, remain strong, and pipeline exports to Mexico hit a record 7.5 Bcf/day in May.

How Supportive Are Inventories and Power Demand?

Inventory data continues to provide modest support. The EIA reported an 80 Bcf injection for the week ending October 10, slightly below expectations and the five-year average. Stocks are still 4.3% above the seasonal norm, reflecting ample supply, but the slight shortfall keeps the market tight enough to support prices during weather-driven demand spikes.

Additionally, electricity demand is strengthening. The Edison Electric Institute reported that U.S. electricity output rose 5.1% y/y in the week ending October 11, a tailwind for natural gas consumption in power generation.

Will Natural Gas Break Through $4 Before November?

With colder weather on deck and momentum building above $3.550, the path to $3.823—and possibly $4.139—looks increasingly plausible. However, the rally remains vulnerable to a reversal if prices fail to hold above $3.585, which could trigger a pullback toward the 50-day moving average at $3.248.

For now, the tone remains bullish, driven by weather and technical momentum. But traders should stay alert to production figures and inventory trends, which could quickly cap further upside if heating demand underwhelms. Eyes remain fixed on the $3.585 resistance; a breakout here could confirm a broader shift in sentiment heading into the heating season.

More Information in our Economic Calendar.