Spot natural gas prices (CFDS ON NATURAL GAS) continued to rise during the recent trading at the intraday levels, to achieve new daily gains until the moment of writing this report, by 1.11%, after its rise in Monday's trading by 6.01%.
Weather remains the main driver of rising natural gas prices as winter refuses to release its grip in 2022. The National Oceanic and Atmospheric Administration's short-term forecast predicts cooler-than-normal temperatures across the United States almost through April 24. This is expected to maintain on some heating demand across supply lines and storage injections decreases during this period. The rise in production did not allay mounting concerns about supplies later this year.
Nymex May futures were up 36.5 cents at $6,643 per million British thermal units. The June futures contract settled at $6.723, an increase of 36.7 cents.
Spot gas prices were also boosted by NGI's Spot Gas National Avg, with huge increases on the West Coast, which jumped 21.0 cents to $6.205.
Amid growing concerns that gas producers are not yet responding to higher prices, production finally took a step higher on Monday. Bloomberg estimates showed production at 96.4 billion cubic feet.
Technically, natural gas succeeded in its recent trading in breaching the pivotal resistance level of 6.412, despite the start of negative signals in the relative strength indicators. This happened after it reached areas of severe overbought operations, so that the price began discharging some of this overbought despite the continuation of the rise. This indicates the strength of the movement bullish on price.
All of this comes in light of the dominance of the main bullish trend in the medium term along a slope line. The dominance of the bullish trend is strong in the short term, with continuous positive pressure for its trading above its simple moving average for the previous 50 days.
Therefore, we expect the rise of natural gas to continue during its upcoming trading, especially as long as its stability is above the level of 6.412, to target the resistance level of 7.181.
