Natural Gas News: Traders Eye 200-Day MA Support and EIA Report for Market Direction

Natural Gas Holds Steady Ahead of EIA Report as Key Technical Levels Come Into Play

Natural gas prices remained flat Thursday, with traders holding their positions ahead of the U.S. Energy Information Administration (EIA) weekly storage report due at 14:30 GMT.

The market is sitting just above its 200-day moving average at $3.534, a level that has consistently offered support since late April. Traders are closely watching this level for signs of trend confirmation or potential breakdown, especially with nearby contracts showing signs of weakness.

At 12:28 GMT, U.S. Natural Gas Futures are trading $3.539, down $0.018 or -0.51%.

Can the 200-Day Moving Average Continue to Provide Support?

Price action is hovering near a critical technical inflection. The 200-day moving average has held firm in recent weeks, fending off declines near $3.381 and $3.444. A decisive break below this threshold could raise red flags for bulls, but may not necessarily trigger broad selling, given the potential for weather-driven short-covering rallies.

Upside momentum remains capped by the 50-day moving average at $4.000, forming a well-defined range that traders will look to fade or break depending on today’s EIA outcome.

Will the EIA Storage Report Confirm Supply Tightening?

Consensus expectations for the upcoming EIA report point to a 93 Bcf injection, down from the prior week’s 98 Bcf and modestly reducing the surplus over the five-year average to 85 Bcf. While not overly bullish, this gradual reduction may support prices if followed by stronger power burns or cooling demand.

Analysts, including Ritterbusch, are cautioning against reading too much into short-term weather patterns, stressing that despite a likely continued storage surplus, there’s little risk of a supply glut developing in the near term.

How Are Weather Patterns Influencing Demand Forecasts?

Short-term demand remains weak due to a mild national pattern, with showers and cooler temperatures suppressing consumption in the eastern half of the U.S. through early June. Texas and the South are also seeing reduced highs in the 70s and 80s, further dampening near-term power demand.

However, NatGasWeather notes that a hotter trend is likely to emerge during the June 4–9 window, with highs in the 80s and 90s spreading across the East. This could revive cooling-related demand and lend support to the July contract.

Market Outlook: Neutral to Slightly Bullish if Heat Builds

In the near term, the market remains rangebound but leans slightly bullish if the June heat forecast verifies and today’s storage report aligns with or undershoots expectations. The $3.534 support level will be key—holding above it reinforces stability, while a move lower invites volatility.

With July gas last trading at $3.57 and weather risks shifting warmer, traders should prepare for upside tests, especially if cooling demand firms into early June.

More Information in our Economic Calendar.