Natural Gas Price Analysis for March 13, 2018

Natural gas prices moved higher on Monday, as a mixed weather forecast is creating an unclear picture. With another nor’easter expected to hit the north east on Tuesday, natural gas prices are getting a boost. Inventories remain in the lower portion of the 5-year range, and below the 5-year average.

Technicals

Natural gas prices shot higher climbing 1.65% on Monday, but settled off the highs of the session. Target resistance on natural gas is seen near the 50-day moving average at 2.89.  Support is seen near the 10-day moving average at 2.72. Momentum remains positive as the MACD (moving average convergence divergence) histogram prints in the black with an upward sloping trajectory which points to higher prices.

Inventories are Lower than the five-year average

Working gas net withdrawals are 72 Bcf lower than the five-year average. Net withdrawals from storage totaled 57 Bcf for the week ending March 2, compared with the five-year average net withdrawal of 129 Bcf and last year’s net withdrawals of 57 Bcf during the same week. Working gas stocks totaled 1,625 Bcf, which is 300 Bcf less than the five-year average and 680 Bcf less than last year at this time. Working gas stocks in all regions in the Lower 48 states are lower than year-ago levels.

Working gas levels are 484 Bcf higher than the five-year minimum. Working gas stocks have rebounded since falling 59 Bcf lower than the five-year minimum range and 486 Bcf lower than the five-year average for the Lower 48 states on January 19, 2018. If net withdrawals from working gas stocks match the five-year average for the remainder of the withdrawal season, working gas stocks will total 1,402 Bcf by March 31, 2018, which is 18% lower than the five-year average. Working gas stocks ended the 2013–14 heating season at 837 Bcf, which is the lowest-reported level for that time.