Natural Gas Price Prediction – Trying To Rebound After Sell-Off

Key Insights

• Natural gas prices managed to gain some ground after the major sell-off on Thursday. 

• Most likely, traders will remain focused on the next EIA report, which may show that working gas in storage is increasing at a robust pace due to problems at Freeport LNG. 

• A move below the support at $5.60 will push natural gas towards the next support level at $5.45.

Natural Gas Found Some Buyers After Yesterday’s Pullback

Naturas gas prices are currently trying to rebound after the major sell-off on Thursday. The sell-off was triggered by the EIA Weekly Natural Gas Storage Report, which indicated that working gas in storage increased by 82 Bcf from the previous week.

The report highlighted rising supply due to problems at Freeport LNG and put natural gas markets under significant pressure.

At this point, it looks that warm weather is insufficient enough to offset the impact of the situation at Freeport LNG.

While weather conditions are favorable for healthy natural gas demand, excessive supply from the decline of LNG exports may continue to put significant pressure on natural gas markets.

Natural Gas Faced Resistance Near $5.80

Natural gas failed to settle above the resistance at $5.80 and moved closer to the support level at $5.60. RSI remains in the moderate territory, and there is enough room to gain additional downside momentum in case the right catalysts emerge.

A successful test of the support at $5.60 will push natural gas towards the next support level at $5.45. If natural gas settles below this level, it will head towards the support at $5.25. A move below $5.25 will open the way to the test of the support at $5.00.

On the upside, natural gas needs to settle above $5.80 to have a chance to develop upside momentum in the near term. The next resistance level is located at $6.00. In case natural gas manages to settle back above this level, it will head towards the resistance at $6.20.

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This article was originally posted on FX Empire

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