Natural Gas Price Prediction – Prices Gain Foothold Ahead of Inventory Report

Natural gas prices found a foothold on Wednesday ahead of Thursday’s inventory report after, falling for the 4-consecutive trading days. Expectations are for a 83 Bcf build in stockpiles according to suvey provider Estimize. This build follows last weeks larger than expected build in natural gas inventories. The weather is expected to remain warmer than average throughout most of the United States during the next two weeks. Warm weather should increase cooling demand during a period when the weather is expected to become milder. There are 4-storms in the Atlantic; the two named storms, Peter and Rose, are expected to stay well away from the continental United States. According to the most recent forecast from NOAA, the other storms have a less than 60% chance of becoming tropical cyclones during the next 48-hours.

Technical Analysis

On Wednesday, natural gas prices found support ahead of the 50-day moving average at 4.27. Resistance is seen near the 10-day moving average at 5.09. Short-term momentum has turned negative as the fast stochastic recently generated a crossover sell signal. Medium-term momentum has turned negative as the MACD (moving average convergence divergence) index generated a crossover sell signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses below the MACD signal line. The MACD histogram is printing in negative territory with a downward sloping trajectory which points to lower prices.