Natural Gas Price Fundamental Daily Forecast – May Try to Consolidate Inside $3.014 to $2.929

Natural gas futures are edging lower on Thursday after giving up earlier gains. The introduction of cooler temperatures has supported the market the last three sessions, but the news wasn’t bullish enough to sustain the move ahead of Friday’s government storage report. The report date was changed because of the government holiday on Wednesday.

At 13:30 GMT, December natural gas futures are trading $3.009, down $0.022 or -0.73%.

Natural Gas Intelligence reported that for a second day in a row, Bespoke Weather Services projected demand gains, with a few days toward the front half of the 15-day outlook moving closer to normal in terms of temperatures. This is the result of “a couple of upper level troughs swinging through the eastern third of the nation,” the forecaster said.

Bespoke, however, expects continued risks for more warmth late this month and into December, increasing the odds of price declines in coming sessions. “The bearish weather remains the major obstacle for bulls, and we expect that to continue, the forecaster said. “As it stands right now, we do not have a single day in the forecast that is colder than normal.”

EIA Expects US LNG Exports to Remain Robust into Next Year

In its latest Short-Term Energy Outlook published Tuesday, the U.S. Energy Information Administration (EIA) estimated exports averaged 7.2 Bcf/d in October, up 2.3 Bcf/d from September volumes. That marked the largest month/month increase on record.

The EIA said it expects US LNG exports to average 8.5 Bcf/d in November, above pre-pandemic levels, and remain robust into next year. The agency predicted export volumes would average 8.4 Bcf/d in 2021, a 31% year/year increase.

Daily Forecast

The main trend is down according to the daily swing chart. A trade through $2.821 will signal a resumption of the downtrend.

A trade through $3.396 will change the main trend to up. This is highly unlikely but there is room for a 50% to 61.8% retracement.

The main range is $2.657 to $3.396. Its retracement zone at $3.014 to $2.929 is potential support. This zone has been tested several times this week.

The short-term range is $3.396 to $2.821. Its retracement zone at $3.109 to $3.176 is the primary upside target. Since the main trend is down, sellers are likely to return on a test of this area.

The early price action suggests traders may try to find support inside $3.014 to $2.929 with $2.943 a possible support price.

Trader reaction to $3.014 is likely to determine the direction of the market today.

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