Natural Gas Price Prediction – Prices Drop Reversing Monday’s Gains

Natural gas prices reversed Monday’s gains after prices broke out on Monday on robust volume. The weather is expected to remain colder than normal on the east coast for the next 2-weeks and warmer than normal on the west coast of the United State for the next 2-weeks. Natural gas supplies rose slightly in the latest week driven by an increase of imports from Canada.

Technical Analysis

Natural gas prices reversed Monday’s gains falling nearly 5% after rising by 12%, on Monday. Prices sliced through support which was former resistance near a downward sloping trend line that come in near 1.88 and 1.92 which are seen as support. Support is seen near the 50-day moving average at 1.80.

Short term momentum has turned positive as the fast stochastic surges higher after recently generating a crossover buy signal. Medium-term momentum has also turned positive as the MACD (moving average convergence divergence) histogram is printing in the red with an upward sloping trajectory which points to higher prices.

Supply Rose Slightly

Supply rises slightly according to data from the EAI. The average total supply of natural gas rose by 1% compared with the previous report week. Dry natural gas production remained unchanged week over week. Average net imports from Canada increased by 18% from last week, with most cross-border points being fully utilized.