Yahoo Finance Natural Gas Price Prediction – Prices Rise Testing Resistance Despite Warm Weather Forecast
Natural gas prices moved higher on Friday despite warmer than normal weather expected to cover most of the Mid-West and East Coast over the next 6-10 days. Prices broke down during the week closing lower by nearly 3%. On Thursday, the EIA reported a smaller than expected draw in natural gas stockpiles relative to expectations. This decline came despite flat week over week production levels which points to lower demand.
Technical Analysis
Natural gas prices rebounded on Friday and look poised to test resistance near the breakdown level, coinciding with the 10-day moving average at 2.58. Additional resistance is seen near the 50-day moving average at 2.73. Support is seen near the January lows at 2.40. Short-term momentum is positive as the fast stochastic generated a crossover buy signal and moved out of oversold territory. Medium-term momentum remains negative as the MACD (moving average convergence divergence) index prints in negative territory with a declining trajectory which points to lower prices.
Production Remains Neutral
Natural gas production stays relatively flat week over week. According to data from the EIA average total supply of natural gas fell by 0.3% compared with the previous report week. Dry natural gas production decreased by 0.1% compared with the previous report week. Average net imports from Canada decreased by 4.2% from last week and now account for less than 5% of total supply.
This article was originally posted on FX Empire
