Natural Gas Price Prediction – Prices Rise But Fail to Take Out Resistance
Natural gas moved higher on Tuesday but was unable to push through resistance ahead of Thursday’s inventory report from the Department of Energy. Expectations are for a 65 Bcf build in stockpiles according to survey provider Estimize. According to the National Oceanic Atmospheric Administration, warmer than normal weather is expected to cover most of the United States for the next 8-14 days. Residential and commercial demand fell due to mild weather.
Technical Analysis
Natural gas prices moved higher on Tuesday but was unable to push through resistance . Target resistance is seen near the February highs at 3.06. Short-term resistance is seen near an upward sloping trend line that comes in near 2.98. The 10-day moving average crossed above the 50-day moving average, which means that a medium-term uptrend is now in place. Short-term momentum has turned as the fast stochastic generated a crossover buy signal. Medium-term momentum is also positive as the MACD (moving average convergence divergence) histogram prints in positive territory with an upward sloping trajectory which points to higher prices.
The EIA Expectations Lower Consumptions
EIA expects that U.S. consumption of natural gas will average 82.9 billion cubic feet per day in 2021, down 0.4% from 2020. The decline in U.S. natural gas consumption is a result of less natural gas consumed for electric power generation because of higher natural gas prices compared with last year. In 2021, we expect residential and commercial natural gas consumption will rise by a total of 1.1 Bcf per day.
This article was originally posted on FX Empire
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