Natural Gas Price Analysis for March 7, 2017

Natural gas prices might have formed a bottom as hedge fund traders dumped long positions in futures and options according to the latest commitment of trader’s report released for the date ending February 28, 2017.  The decline in long position was one of the largest of the past 12-months. Prices gapped higher closing up 2.76%, but well of the highs of the session.  Support is seen near the 10-day moving average at 2.77, while resistance is seen near the February 15 highs at 3.09.

Momentum has Turned Positive

Momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the spread (the 12-day moving average minus the 26-day moving average) crosses above the 9-day moving average of the spread. The index moved from negative to positive territory confirming the buy signal. The index is printing in the black with an upwards sloping trajectory which points to higher prices.