Natural Gas Price Prediction – Prices Whipsaw and End Higher as Demand Continues to Climb

Natural gas prices whipsawed and moved higher, rising 3% but well off the session highs, which saw prompt prices climb 10%. The weather is expected to be slightly warmer than normal during the next two weeks. This could increase cooling demand. There is a lot of tropical activity in the Atlantic. Hurricane Sam is a major hurricane, but it is not expected to hit any land and only disrupt transportation. According to NOAA, there are two disturbances off the African coast, one with a 90% chance and one with a 70% chance of becoming a tropical cyclone during the next 48-hours. U.S. LNG export increased last week.

Technical Analysis

Natural gas prices surged higher but close well off the session highs. Prices hit a 7-year high above 6 per MMbtu. Target resistance is the 2014 highs at 6.50. Support is seen near the former September highs at 5.65. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs when the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line).

LNG Exports Rose

U.S. LNG exports increase week over week. Twenty-one LNG vessels with a combined LNG-carrying capacity of 76 Bcf departed the United States between September 16 and September 22, 2021, according to shipping data provided by the EIA. Additional LNG exports could be hampered by the storm activity in the Atlantic.