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David Becker
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Natural gas prices continued to trading in a tight range, unable to break out or break down. This followed a slightly less than expected build in natural gas inventories reported on Thursday by the Energy Information Administration. The weather is expected to be colder than normal over the next 6-10 days in the East Coast and the mid-Atlantic. Energy production in the U.S fell 5% in 2020. Total production of energy in the United States fell to just below 96 quadrillion British thermal units.

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Technical Analysis

Natural gas prices moved lower on Thursday after testing resistance levels and failing. Target resistance is seen near the February highs at 3.06. Short-term resistance is seen near an upward sloping trend line that comes in near 2.97. Support is seen near the 10-day moving average at 2.92. The 10-day moving average crossed above the 50-day moving average, which means that a medium-term uptrend is now in place. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. Medium-term momentum is positive but decelerating as the MACD (moving average convergence divergence) histogram prints in positive territory with a sliding trajectory which points to consolidation.

Natural gas in storage was 1,958 Bcf as of Friday, April 30, 2021, according to the EIA. This represents a net increase of 60 Bcf from the previous week. Expectations were for a 65 Bcf build in stockpiles according to survey provider Estimize. Stocks were 345 Bcf less than last year at this time and 61 Bcf below the five-year average of 2,019 Bcf. At 1,958 Bcf, total working gas is within the five-year historical range.

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