Natural Gas Price Prediction – Prices continued to face downward pressure amid cooler temperatures

Key Insights

• Natural gas prices hover near the $8.5 mark.
• The weather is expected to become cooler than normal in early June. 
• Russia might cut off the natural gas supply to certain European counties.

On Monday, natural gas prices continued to sharply decline. According to the National Oceanic Atmospheric Administration, the weather is expected to be warmer than normal during the next 6-10 days and 8-14 in the South.

However, the weather is expected to become cooler than normal during the next 6-10 days and 8-14 days in the Northeastern part of the United States. Prices decline as the weather becomes cooler and demand decreases. 

Russia might cut off the natural gas supply to Denmark and the Netherlands. Although these countries do not rely on Russia for a significant amount of energy consumption, the cut could cause an increase in natural gas prices.

Technical Analysis

On Tuesday, natural gas prices remained below the 10-day moving average of $8.57, remaining in the red for the third consecutive trading session. Support is seen near the 10-day moving average of 8.51.

Resistance is seen near the $9 mark. A break above that could signal upward traction for the commodity. Short-term momentum turns negative as the fast stochastic generated a crossover sell signal.

Medium-term momentum turned negative as the MACD had a crossover sell signal. The MACD (moving average convergence divergence) histogram prints in negative territory with a falling trajectory, meaning downside trade action.