Yahoo Finance Natural Gas Prices Rally from the Key Support
Tug-of-War between Weather and Inventory Data
Price channel
September natural gas futures contracts rallied from the key support of $2.70 per MMBtu (British thermal units in millions) on August 19, 2015. Prices have been fluctuating between 2.70 per MMBtu and $2.90 per MMBtu since early June 2015. Inventory and weather data are playing a vital role in driving natural gas prices.
Key pivots
Bearish traders could see support for natural gas at $2.60 per MMBtu. Prices tested this level in June 2015. The rising natural gas stocks could drag natural gas prices lower. In contrast, natural gas prices could see resistance at $3 per MMBtu. Prices tested this level in April 2015. Warm weather could benefit natural gas prices.
The rectangular trading range suggests that natural gas prices could fluctuate between $2.60 and $3 per MMBtu in the near term. Bank of America Merrill Lynch (BAML) expects that natural gas prices could average around $2.85 per MMBtu in 2015. Citigroup forecasts that natural gas prices could average around $2.70 per MMBtu in 2015 and $3 per MMBtu in 2016.
Rising natural gas prices benefit ETFs like the VelocityShares 3X Long Natural Gas ETN (UGAZ) and the United States Natural Gas Fund LP (UNG).
Natural gas producers like Chesapeake Energy (CHK), Antero Resources (AR), and Energen (EGN) also benefit from rising natural gas prices. Combined, they account for 3.33% of the SPDR Oil and Gas ETF (XOP). These companies’ natural gas production mix is greater than 59% of their total production.
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