Natural Gas Prices Slipped Failing at Key Resistance

Key Insights

• Natural gas prices eased on Tuesday.
• The weather is expected mixed over the next two weeks.
• Natural gas supplies were flat.

Natural gas prices were lower on Tuesday after testing resistance earlier in the trading session. The supply of natural gas in the latest week was flat. Russia shut off natural gas supplies to Poland, which temporarily boosted European natural gas prices. The weather is expected to be colder than average for the next 2-weeks.

U.S. supply of natural gas remains unchanged this week. According to the EIA, the average total supply of natural gas was flat compared with last week, averaging 100.5 Bcf per day. Dry natural gas production decreased by 0.4% compared with the previous report week, and average net imports from Canada increased by the same amount, 0.4 Bcf per day, a 6.5% increase.

Technical Analysis

Natural gas prices slipped. Prices tested resistance is seen near the 10-day moving average at 6.98, and failed and eventually closed lower. Target resistance is seen near the April highs at 8.06. Support is seen near the 50-day moving average at 5.44.

Medium-term momentum has negative. The MACD histogram is printing in negative territory with a declining trajectory which points to lower prices.

The MACD (moving average convergence divergence) generated a crossover sell signal. This scenario occurs when 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.