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David Becker
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Natural gas prices moved higher on Wednesday as tropical cyclone number 9, heads toward the Caribbean. The trajectory of the storm is pointing to landfall in the United States, with a target of the west coast of Florida. A shift to the west would put the storm on course to head toward natural gas installation which could generate a supply disruption. Traders now await the Energy Departments inventory report scheduled for Thursday. Expectations are for a 24 Bcf build according to survey provider Estimize. KNG exports increased week over week, reflecting an increase in demand.

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Technical Analysis

Natural gas prices surged on Wednesday, rising nearly 2% as the August contract expired. The September contract ran into resistance near a downward sloping trend line that comes in near 1.90. A break of that would lead to a test of the July highs near $2. Support is seen near the 50-day moving average at 1.85 which was former resistance. Momentum remains positive as the MACD (moving average convergence divergence) index recently generated a crossover buy signal. The MACD histogram is printing in the black with an upward sloping trajectory which points to higher prices.

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US LNG Exports Rise

US LNG exports increase week over week. Seven LNG with a combined LNG-carrying capacity of 25 Bcf departed the United States between July 16 and July 22, 2020, according to shipping data provided by the EIA.

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