Technical Analysis Natural Gas for November 27, 2015

Natural gas prices were lower in thin trade as continued builds into storage are generating headwinds for price action. According to the Energy Information Administration, working gas in storage was 4,009 Bcf as of Friday, November 20, 2015. This represents a net increase of 9 Bcf from the previous week. Stocks were 554 Bcf higher than last year at this time and 252 Bcf above the five-year average of 3,757 Bcf. At 4,009 Bcf, total working gas is above the five-year historical range.

Resistance on natural gas is seen near the recent support at 2.355, while support is the November lows at 2.23. Momentum has turned negative with the MACD (moving average convergence divergence) index generating a sell signal.  This occurs as the spread (the 12-day moving average minus the 26-day moving average) crosses below the 9-day moving average of the spread.