Natural Gas Price Prediction – Prices Consolidate Settling Slightly Lower for the Week

Natural gas prices moved sideways on Friday closing the session nearly unchanged. Post-tropical storm Elsa is moving up the East coast and is unlikely to impact any natural gas installations. The weather is expected to remain warmer than normal for the next two weeks on both the east coast and west coast of the United States, putting upward pressure on cooling demand. LNG global trade was flat according to a report from the EIA.

Technical Analysis

Natural gas prices moved sideways on Friday. Support near the 10-day moving average at 3.64. Resistance on natural gas is seen near the July highs at 3.82. Short-term momentum has flip-flopped and turned positive as the fast stochastic generated a crossover buy signal. The RSI has moved back into overbought territory and is printing a reading of 71, above the overbought trigger level of 70, which foreshadows a correction. Medium-term momentum is neutral as the MACD (moving average convergence divergence) histogram is printing in positive territory with a flat trajectory reflecting consolidation.

LNG Global Trade

Global trade in liquefied natural gas in 2020 remained essentially unchanged from 2019, averaging 46.9 billion cubic feet per day compared with 46.7 Bcf per day in 2019, according to the recently released report from the EIA. This 0.4% annual increase in LNG trade occurred despite the COVID-19 pandemic that reduced global natural gas demand. Between 2015 and 2019, global LNG trade expanded by 45%, posting record growth in both 2018 and 2019. This expansion primarily resulted from liquefaction capacity additions in Australia, the United States, and Russia, which combined accounted for more than 90% of the global growth in liquefaction capacity during this period.