Natural Gas Rebound Above Resistance

Natural gas prices rebounded on Friday after dropping on Thursday. Prices recaptured resistance near a downward sloping trend line near the 10-day moving average at 2.71. Momentum is neutral as the MACD (moving average convergence divergence) histogram prints near the zero-index level with a flat trajectory which reflects consolidation.

Supply falls slightly

According to data from the EIA, the average total supply of natural gas fell by 1% compared with the previous report week. Dry natural gas production decreased by 1% compared with the previous report week, and average net imports from Canada decreased by 9% from last week.

Demand falls

Total U.S. consumption of natural gas fell by 9% compared with the previous report week, according to data from the EIA. In the residential and commercial sectors, consumption declined by 22% as warm temperatures in the South and West offset increases in heating demand in the Midwest and Northeast. Natural gas consumed for power generation climbed by 2% week over week. Industrial sector consumption decreased by 3% week over week. Natural gas exports to Mexico decreased 1%

Canadian CPI Increased

Canada CPI grew 0.3 in March after the 0.6% surge in February. CPI accelerated to a 2.3 year over year clip in March from 2.2% in February, the fastest rate since the 2.4% pace in October of 2014. The CPI-trim slowed to a 2.0% rate of year over year growth from 2.1%, the CPI-median expanded 2.1% versus an identical 2.1% and the CPI-common held at 1.9% from 1.9%. While total CPI growth is elevated and the core measures remain close to 2%, this report is a bit softer than anticipated, which may temper elevated expectations for a BoC rate hike in May.

Canada retail sales rose

Canada retail sales rose 0.4% in February after a revised 0.1% gain in January. A 1.4% rebound in motor vehicle sales and parts dealers drove the increase in total sales during February, as expected. The ex-autos sales aggregate was flat following a revised 1.0% gain in January.