Natural gas prices rebounded 2% on Monday after tumbling more than 7% on Friday, due to warmer than normal weather expected across most of the United States. Natural gas storage injections in the United States outpaced the previous five-year average during the 2019 injection season as a result of rising natural gas production according to the EIA. The EIA expects natural gas storage withdrawals to total 1.9 trillion cubic feet between the end of October and the end of March
Natural gas prices rebounded 2% after tumbling more than 7.5%, on Friday and closing down 13.2% for the week. Support is easier to see on a weekly chart as prices appear to have touched trend line support near 2.27. Resistance on natural gas prices is seen near former support at 2.48. Medium term momentum is negative as the MACD histogram is printing in the red with a downward sloping trajectory which points to lower prices. Short term momentum has turned positive as the fast stochastic generated a crossover buy signal in oversold territory which points to a potential correction in natural gas prices.
Storage Injections Soar
The Energy Information Administration reported that natural gas storage injections in the United States outpaced the previous five-year average during the 2019 injection season as a result of rising natural gas production. At the beginning of April, when the injection season started, working inventories were 28% lower than the five-year average for the same period. By October 31, U.S. total working gas inventories reached 3,762 billion cubic feet which was 1% higher than the five-year average and 16% higher than a year ago. The EIA expects natural gas storage withdrawals to total 1.9 trillion cubic feet between the end of October and the end of March, which is less than the previous five-year average winter withdrawal.
This article was originally posted on FX Empire
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