Natural Gas Prices Rise on Cooler Weather Forecast

Insight

Natural gas prices moved higher on Thursday following the Department of Energy’s inventory report. The weather forecast has changed to show cooler weather in the mid-West. According to a report from NOAA, the weather in the U.S. is expected to be colder than normal all the way to Texas from Chicago in the United States for the next 6-10 and 8-14 days.

Natural gas in storage was 1,440 Bcf as of Friday, March 11, 2022, according to EIA forecasts. This represents a net decrease of 79 Bcf from the previous week. Expectations were for a 90 Bcf draw according to survey provider Estimize. Stocks were 344 Bcf less than last year at this time and 304 Bcf below the five-year average of 1,744 Bcf. At 1,440 Bcf, total working gas is within the five-year historical range.

Technical Analysis

Natural gas prices rose on Thursday. Support is seen near the 10-day moving average at 4.72. Resistance is seen near a downward sloping trend line that comes in near 5.20.

Short-term momentum has turned positive as the fast stochastic generated a crossover buy signal. Medium-term momentum has turned positive. The MACD (moving average convergence divergence) index is making a crossover buy signal. This scenario occurs when the MACD line (the 12-day moving average minus the 26-day moving average, crosses above the 9-day moving average of the MACD line.