Natural Gas Price Prediction – Prices Rise Following Inventory Report

Natural gas prices moved higher on Thursday following the inventory report released by the Energy Information Administration (EIA). Traders are focusing on demand which is expected to climb slightly as businesses get back to work. With COVID cases accelerating in many states across the United States the road to increasing electricity demand might be a while.

Technical Analysis

Natural gas prices moved higher on Thursday following an inventory report that was in line with expectations. Prices pushed through resistance which is now short term support near the 10-day moving average at 1.89. Resistance is seen near the June highs at 1.89. Short term momentum is positive as the fast stochastic generates a crossover buy signal and is accelerating higher. Medium-term momentum is poised to turn positive as the MACD (moving average convergence divergence) index is about to generate a crossover buy signal.

Inventories Were In Line with Expectations

The Energy Information Administration reported that natural gas in storage was 2,807 Bcf as of Friday, June 5, 2020. This represents a net increase of 93 Bcf from the previous week. This was right in line with expectations according to survey provider Estimize. Stocks were 748 Bcf higher than last year at this time and 421 Bcf above the five-year average of 2,386 Bcf. At 2,807 Bcf, total working gas is within the five-year historical range.