Spot natural gas prices (CFDS ON NATURAL GAS) rose in early trading on Tuesday, to achieve new daily gains, up to the moment of writing this report, by 5.08%. It settled at $6.618 per million British thermal units, after advancing during yesterday’s trading and for the fourth day in a row. by 4.17%.
U.S. natural gas futures jumped to their highest levels in more than a week on Monday, boosted by expectations of cooler-than-usual weather and rising heating demand over the next two weeks.
With cooler weather looming, data provider Refinitiv expects average US gas demand, including exports, to rise from 123.4 bcfd this week to 145.8 bcfd next week.
The prospect of Freeport LNG returning to partial operation early next month is also a positive side for the price. Freeport has announced that it will postpone the planned restart of its LNG export plant in Texas from mid-December to the end of the year. The delay could keep LNG exports below the March record levels and leave more gas in the US for domestic use.
Some analysts don't expect Freeport to return until January, February or later because federal pipeline safety regulators will likely take longer than Freeport expects to review and approve a plant restart plan once the company submits it.
Natural Gas Technical Analysis
Technically, natural gas continues to rise with the support of positive signals in the relative strength indicators. Also, during its trading above its simple moving average for the previous 50-day period, so that the price in its early trading for today surpassed the important 6.412 resistance level. In turn attacked the bearish corrective slope line in the short term, as shown in the attached chart for a period (daily).
Therefore, our expectations suggest more rise for natural gas during its upcoming trading, especially as long as it stabilizes above 6.412, to target the 7.548 resistance.
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