Natural Gas Price Analysis – Natural Gas Drifts as April Gap Fill Looms

Natural Gas Technical Analysis

The natural gas market has fallen a bit during the early part of the trading session on Tuesday, but as you can see, the market has been rather soft to begin with. Ultimately, this is a market that I think will try to sort out whether or not it needs to fill the gap from late April, and quite frankly, there isn’t much on this chart that makes me think it can’t do that. After all, we are in a very quiet time of year. Typically speaking, this time of year, when we do see a spike in gas, it has a lot to do with heat, not heating the home, but a heatwave. Right now, in the U.S., we’ve got warmer temperatures, but nothing extraordinary.

As we are trading the September contract at the moment, it’s not necessarily a contract that’s going to be worried about freezing cold temperatures either. So with that being the case, the market is likely to remain noisy, but I think it also has a very real feel of a potential market of malaise. That’s typically how I view it this time of year anyways.

Qatar LNG Demand and Hormuz Geopolitics Eye Winter Setup

One factor that might be worth paying attention to is whether or not Qatar continues to import U.S. natural gas to fulfill their contracts with the Europeans. That’s been going on recently, and as we get later into the year, if the Strait of Hormuz is still closed, if the Qatar natural gas production ability is brought back down again, that could come into play. It could make for a wild winter; we will just have to wait and see.

Ultimately though, this is a market that looks very lackluster. Rallies, more likely than not, will find plenty of sellers interested in trying to fade the first signs of exhaustion. That is how I have played natural gas for years.

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