Natural Gas Price Analysis for April 26, 2017

Natural gas prices continue to trade on the defensive as it appears that hedge funds remain long, which means that lower prices are the path of least resistance.  According to the latest commitment of trader’s report for the date ending April 18, managed money had accumulated a net long position equivalent to 3,511 billion cubic feet, the highest for three years, according to the CFTC.  Traders await Thursday’s inventory report which is scheduled to be released at 10:30 ET by the Energy Information Administration.

The Trend is Lower

Prices made a lower low a lower high and a lower close which is the hallmarks of a downtrend. Support on natural gas prices is seen near the March 17 lows at 2.94.  Resistance is seen near the 10-day moving average at 3.14.  Momentum remains negative as the MACD (moving average convergence divergence) index recently generated a crossover sells signal.  The index is printing in the red with a downward sloping trajectory which points to lower prices.