Natural Gas Price Prediction – Prices Edge Higher Following Rig Count
Natural gas edged higher, despite a report from Baker Hughes that showed that oil and gas rigs increased for the 4th consecutive week. The weather is expected to be cooler than normal on the east coast for the next 2-weeks while the weather is expected to be warmer than normal throughout most of the west coast.
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Technical Analysis
Natural Gas prices edged higher on Friday testing resistance near a downward sloping trend line that comes in near 2.69. Support is seen near the December lows at 2.40. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. The MACD histogram is printing in positive territory with an upward sloping trajectory which points to higher prices.
Demand Rises
Demand rises, reaching a daily high for the heating season. According to data from The EIA total U.S. consumption of natural gas rose by 0.4% compared with the previous report week. On December 16, total demand reached a daily high of 124.8 Bcf/d, the highest level for this heating season. Natural gas consumption in the residential and commercial sectors increased by 3.9%, and power generation consumption declined by 4.4% week over week.