Natural Gas Price Fundamental Daily Forecast – Lingering Weather Issues Pushing Market Through Resistance

Natural gas futures closed higher on Monday, underpinned by new medium-range forecasts that pointed towards lingering cold temperatures that could extend winter demand for the heating fuel.

May Natural Gas futures settled at $2.800, up $0.41 or +1.49%.

The futures markets were essentially supported by strengthening spot markets in the Northeast and Mid-Atlantic which were boosted by yet another East Coast storm.

Forecast

Yesterday’s strong rally and today’s early follow-through to the upside indicates the presence of buyers.

At 0932 GMT, May Natural Gas is trading $2.821, up $0.021 or +0.75%.

The main trend turned up on Monday when buyers took out $2.819. This also negated last week’s closing price reversal top. A new main bottom was formed at $2.739. A move through this level will change the main trend to down.

The main range is $2.951 to $2.600. Its 50% to 61.8% retracement zone is $2.775 to $2.817. Earlier today, the market crossed to the strong side of the retracement zone, putting the market in a potentially bullish position.

Based on the early price action, the direction of the market today will likely be determined by trader reaction to $2.817.

According to NatGasWeather.com, “National heating demand will increase to strong levels this week as a weather system strengthens over the Southeast with areas of rain, snow, and ice, then tracking north along the Mid-Atlantic Coast and into the Northwest Tuesday to Thursday. This system will again have characteristics of a Nor’easter as rain and snow wrap into major Northeast cities just as the systems surface pressure rapidly fall to produce gusty winds.”