Natural Gas Technical Analysis: Price is Back Down

Spot natural gas prices (CFDS ON NATURAL GAS) declined in their recent trading at intraday levels, to record daily losses until the moment of writing this report by -2.95%. It rose in trading yesterday by 4.53%, and during last week’s trading, natural gas decreased by – 9.93%.

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Nymex August futures settled on Friday at $5,730/MMBtu, an increase of 30.6 cents on the day. September futures contracts also rose by 32.0 cents to $5.712.

However, NGI’s Spot Gas National Avg prices continued to decline amid poor expectations for the Independence Day weekend, down 77 cents to $5,460.

Natural gas prices fell to their lowest level in three months, after the extended shutdown of a large LNG plant in Texas helped utilities increase their inventories. Natural gas futures were far from 14-year highs near $9.50 per million British thermal units touched less than a month ago.

The natural gas market was also shocked after the US Energy Information Administration on Thursday announced a larger-than-expected weekly increase in inventories. This raises concerns that the Freeport LNG terminal outage is having a greater impact on inventories than previously thought.

Technically, the price tried, with its previous trading, to discharge some of its clear oversoldness with the relative strength indicators, especially with the start of positive signals from them, and compensating part of what it incurred from previous losses, and this came after the stability of the important support level 5.660, and in light of the control of the main bullish trend in the medium term Along a slope line, as shown in the attached chart for a (daily) time period.

But in front of that, the negative pressure continues due to its trading below the simple moving average for the previous 50 days, in addition to the control of a bearish corrective wave on the price movement in the short term.

Therefore, our expectations suggest a decline in natural gas during its upcoming trading, especially if it breaks the 5.660 support, to target the 4.742 support level.