Natural Gas Price Prediction – Prices Slide on Profit Taking Ahead of Inventory Report

Natural gas prices reversed course on Wednesday ahead of Thursday’s inventory report from the Department of Energy. Expectations are for a 66 Bcf build in stockpiles, according to survey provider Estimize. According to NOAA, the weather is expected to remain warmer than normal over the next 6-10 and 8-14 days. Hurricane Sam continues to swirl in the Atlantic along with the new tropical depression number 10. Neither are expected to hit any natural gas installations. U.S. supplies increased in the latest week as Gulf of Mexico production came back online.

Technical Analysis

Natural gas prices reversed course on Wednesday, slumping 7%. Support is seen near the 10-day moving average at 5.22. Resistance is seen near the September highs at 6.32. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. Medium-term momentum remains positive, but its decelerates as the MACD (moving average convergence divergence) histogram is printing in positive territory with a declining trajectory that points to consolidation.

U.S. Supply Rise

U.S. supply of natural gas increases slightly as Gulf of Mexico production continues to come back online. According to data from the EIA, the average total supply of natural gas rose by 0.2% compared with the previous report week. Dry natural gas production grew by 0.3% compared with the previous report week. Natural gas production in the Gulf of Mexico continues to come back online after being almost completely shut-in following Hurricane Ida.