The weather is expected to remain warm
Natural gas prices moved lower in the wake of Thursday’s inventory report from the Department of Energy. According to a National Oceanic Atmospheric Administration (NOAA) report, the weather is expected to remain warmer than normal for the next 2-weeks, on the East and West Coast with cooler than normal weather in the South. There is one tropical storm that has a 10% chance of turning into tropical cyclones according to a NOAA forecast in the next 48-hours.
Natural gas prices eased Thursday remained below resistance, near the 10-day moving average at 3.67. Additional resistance is seen near the July highs, near 3.82. Support is seen near the July lows at 3.52. Prices are forming a bull flag continuation pattern which is a pause that refreshes higher. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. Medium-term momentum is neutral and turning negative as the MACD (moving average convergence divergence) histogram is printing near the zero-index and is poised to cross below reflecting accelerating negative momentum.
Natural gas in storage was 2,629 Bcf as of Friday, July 9, 2021, according to EIA estimates. This represents a net increase of 55 Bcf from the previous week. Expectations were for a 48 Bcf build according to survey provider Estimize. Stocks were 543 Bcf less than last year at this time and 189 Bcf below the five-year average of 2,818 Bcf. At 2,629 Bcf, total working gas is within the five-year historical range.
David Becker focuses his attention on various consulting and portfolio management activities at Fortuity LLC, where he currently provides oversight for a multimillion-dollar portfolio consisting of commodities, debt, equities, real estate, and more.