Yahoo Finance Natural Gas Price Prediction – Prices Slip Despite Large Inventory Draw
Natural gas prices eased slightly on Friday, despite a larger than expected draw in natural gas inventories. Warmer than normal weather is expected to cover most of the United States’ mid-west for the next 2-weeks which is putting downward pressure on prices.
Technical Analysis
Natural gas prices moved lower but finished of the lows of the trading session. Resistance is seen near the 10-day moving average at 2.63. Support is seen near the December lows at 2.26. Medium-term momentum has turned negative as the MACD (moving average convergence divergence) index generated a crossover sell signal. This occurs as 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. Short-term omentum has also turned negative as the fast stochastic generated a crossover sell signal. The current reading on the fast stochastic is 7, below the oversold trigger level of 20, which could foreshadow a correction.
Inventories Decline More than Expected
The EIA reported that natural gas in storage was 3,009 Bcf as of Friday, January 15, 2021. This represents a net decrease of 187 Bcf from the previous week. Expectations were for a 164 Bcf draw according to survey provider Estimize. Stocks were 36 Bcf higher than last year at this time and 198 Bcf above the five-year average of 2,811 Bcf. At 3,009 Bcf, total working gas is within the five-year historical range.
This article was originally posted on FX Empire
