Natural Gas Price Analysis for August 11, 2017

Natural gas prices soared on Thursday, as a smaller than expected storage build caught traders offsides. Prices surged 3.5%, testing the $3 per mmbtu level, and closing near its highs. Resistance is seen near 3.11, while support is seen near the 10-day moving average at 2.84. Momentum has turned positive as the MACD (moving average convergence divergence) index generated a 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.

Inventories Increased Less than Expected

The EIA reported that working gas in storage was 3,038 Bcf as of Friday, August 4, 2017. This represents a net increase of 28 Bcf from the previous week. Expectations were for a 20 Bcf rise. Stocks were 275 Bcf less than last year at this time and 61 Bcf above the five-year average of 2,977 Bcf. At 3,038 Bcf, total working gas is within the five-year historical range.