Natural Gas Price Prediction – Prices Consolidate Ahead of Stockpile Data
Natural gas prices consolidated and is forming a bear flag pattern which is a pause that refreshses lower. This comes ahead of Thursday inventory report from the Department of energy. Expectations are for a 10 BCF draw according to survey provider Estimize. Net withdrawals in the prior week were 11 Bcf. The weather is expected to be warmer than normal throughout most of the US for the next 8-14 days.
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Technical Analysis
Natural gas prices formed is forming a bear flag pattern after forming an inside day on Tuesday. Resistance is seen near the 10-day moving average at 2.55, support is seen near the March lows at 2.42. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. Medium-term positive momentum is decelerating as the MACD histogram is printing in positive territory with a flattening trajectory which points to consolidation.
Stockpiles are Poised to Rise
We are now at the end of the injection season and the warm weather is likely to generate a build before long. Recall, the net withdrawals from storage totaled 11 Bcf for the week ending March 12, compared with the five-year average net withdrawals of 59 Bcf and last year’s net withdrawals of 15 Bcf during the same week. Working natural gas stocks totaled 1,782 Bcf, which is 93 Bcf lower than the five-year average and 253 Bcf lower than last year at this time.