Natural Gas Price Prediction – Prices Tumble Ahead of Inventory Report

Inventories are expected to rise by 107 Bcf
David Becker
Natural Gas

Natural gas prices tumbled on Wednesday ahead of the Department of Energy’s inventory report which is scheduled for Thursday. Expectations are for a 107 Bcf build in natural gas inventories according to Estimize. Last week the EIA reported a 106 Bcf building in stockpiles which was in line with expectations. The weather is expected to be cold in the west and warm in the southeast over the next 6-10 days, but after that the weather is expected to be more mild, which might reduce demand during a shoulder period.

Technical Analysis

Natural gas prices tumbled on Wednesday, dropping 2.7%, diving through support level which is an upward sloping trend line that connects the lows in April and the lows in May and come in near 2.57, which is seen as short term resistance. Support is seen near the May lows at 2.51. Short term momentum is negative as the fast stochastic continues to tumble. The current reading on the fast stochastic is 16, below the oversold trigger level of 20 which could foreshadow a correction. Medium term momentum is turning negative. The MACD (moving average convergence divergence) index is poised to generate a crossover sell signal.

Power Generation Demand is Expected to Rise

The EIA forecasts that US total utility electricity generation from natural gas-fired power plants to rise to 37% from 35% in 2018 and to 38% in 2020. EIA forecasts that the share of electricity generation from coal will average 24% in 2019 and 22% in 2020, down from 27% in 2018. The nuclear share of generation was 19% in 2018, and EIA forecasts that it will stay near that level in 2019 and in 2020. The generation share of hydropower averages 7% of total generation in EIA’s forecast for 2019 and 2020, similar to 2018. Wind, solar, and other nonhydropower renewables together provided about 10% of electricity generation in 2018. EIA expects they will provide 11% in 2019 and 13% in 2020.

Don't miss a thing!

Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All

Top Promotions

Top Brokers

IMPORTANT DISCLAIMERS
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
RISK DISCLAIMER
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
FOLLOW US