Natural Gas Price Prediction – Prices Whipsaw Ahead of Inventory Report

Key Insights

• Natural gas prices whipsawed and moved lower.
• The weather is expected to be warmer than normal in the South.
• Expectations are for 84 Bcf build in stockpiles.

On Wednesday, natural gas prices whipsawed, initially moving higher and then diving lower ahead of Thursday’s inventory report from the Department of Energy. According to the National Oceanic Atmospheric Administration, the weather is expected to be warmer than normal throughout most of the United States next 6-10 and 8-14 days.

On Thursday, the Energy Information Administration is scheduled to release its inventory report. According to survey provider Estimize, expectations are for an 84 Bcf draw in stockpiles. Natural gas imports to LNG facilities were above 13 Bcf for 4 of the last 5-days.

Technical Analysis

Natural gas prices whipsawed, moving higher and then diving lower and closing near the lows of the session. Support is seen near the 50-day moving average of 7.50

Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal.

Medium-term momentum has turned negative as the MACD (moving average convergence divergence) generated a crossover sell signal. This scenario occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses below the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram prints in negative territory with a falling trajectory which points to lower prices.