Natural Gas Price Prediction – Prices Slide Forming Outside Day
Natural gas prices moved lower on Tuesday reversing Monday’s rally. Prices formed and outside day which is a bearish signal. Cooler than normal weather is expected to cover most of the mid-west for the next 2-weeks while the weather is expected to be warmer than normal on the east coast. This would create a wash in heating demand. Tropical Depression Beta is moving inland in Texas, dropping significant rain in Houston. There is another storm over the Caribbean, but it has a very small chance of becoming a tropical cyclone in the next 48-hours according to NOAA.
Technical Analysis
Natural gas prices dropped 4.7% reversing Monday’s rally. Prices formed an outside day, which is a higher high a lower low, and a lower close which is a bearish signal. Short term momentum has turned negative as the fast stochastic generated a crossover sell signal. Medium-term momentum is negative as the MACD (moving average convergence divergence) histogram prints in the red with a downward sloping trajectory which points to lower prices.
Supplies Fall in Latest Week
Supply falls amid shut-ins in the Gulf of Mexico. According to data from the EIA the average total supply of natural gas fell by 1.2% compared with the previous report week. Dry natural gas production decreased by 1.5% compared with the previous report week. The average net imports from Canada increased by 7.2% from last week.
This article was originally posted on FX Empire
