Natural Gas Price Prediction – Prices Rebound on Cold WeatherCost weather is spreading across the west coast
Natural gas prices rebounded on Tuesday rising 2.6%. Cold weather in the north east helped to buoy prices but this will be short-lived. The weather is expected to remain mild across the mid-west and the east coast, which has put downward pressure on prices, but cold weather in the west could continue to move east helping buoy prices. Supply rose in the latest week according to the EIA.
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Natural gas rebounded on Tuesday rising nearly 2.6%. Prices made a higher high and a higher low which is a sign that a bottom is in place. Resistance is seen near the 10-day moving average at 2.87. Short-term momentum has turned positive as the fast stochastic generate a crossover buy signal and moved out of oversold territory. Medium-term momentum is negative as the MACD (moving average convergence divergence) index recently 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 9-day moving average of the MACD line. The MACD histogram is printing in negative territory with a downward sloping trajectory which points to lower prices.
Supply rose but remains lower than the week before last. According to the EIA, the average total supply of natural gas rose by 2.9% compared with the previous report week. After last week’s production losses due to freeze-offs, dry natural gas production increased by 4.1% compared with the previous report week. Dry gas production remains lower than normal at an estimated 9.2% lower than the week ending February 10 and 13.6% lower than the same week last year.