Natural Gas Price Prediction – Prices Fall Despite Storm Activity

Natural gas prices moved lower following the inline inventory report released on Thursday by the Department of energy. Tropical Storm Fred was downgraded to a Tropical Depression in the Caribbean. A second storm has come off the coast of Africa that has a 60% chance of becoming a tropical cyclone in the next 48-hours. The weather is expected to be warmer than normal throughout most of the north part of the United States for the next 2-weeks. This should increase cooling demand across most of the northern portion of the United States.

Technical Analysis

On Thursday, natural gas prices moved lower slicing through support which is now resistant near the 10-day moving average at 4.05. Support is seen near an upward sloping trendline that comes in near 3.85. Short-term momentum turned negative as the fast stochastic generated a crossover sell signal. Medium-term momentum turned negative as the A MACD (moving average convergence divergence) index generated a crossover sell signal. This scenario occurs as the MACD (moving average convergence divergence) index generated a crossover sell signal.

Inventories Rose In Line with Expectations

Natural gas in storage was 2,776 Bcf as of Friday, August 6, 2021, according to the EIA. This represents a net increase of 49 Bcf from the previous week. Expectations were for a 49 Bcf build according to survey provider Estimize. Stocks were 548 Bcf less than last year at this time and 178 Bcf below the five-year average of 2,954 Bcf. At 2,776 Bcf, total working gas is within the five-year historical range.