- Spot natural gas prices (CFDS ON NATURAL GAS) settled on slight gains during its early trading on Thursday, to record new daily losses until the moment of writing this report, by -0.52%.
- It settled at $4.171 per million British thermal units, after rising during yesterday’s trading.
- By 3.50%, to break this rise, a series of losses lasted for four consecutive sessions.
US natural gas futures jumped nearly 5% on Wednesday, after hitting a 10-month low in the previous session, with the price gains coming on expectations of higher-than-expected demand for LNG exports over the next two weeks.
Traders said the biggest uncertainty for the market remains when the Freeport LNG terminal restarts its LNG export plant in Texas.
When Freeport is back up and running, American demand for gas will increase. The plant can convert about 2.1 billion cubic feet of gas into LNG, which is about 2% of daily US production.
Early in the day gas prices fell in Europe as a combination of mild weather and lower industrial consumption led to an unusually seasonal build in inventories threatening to flood the storage system.
Inventories in the European Union and the United Kingdom (EU28) are at the second highest level for this time of year in the past decade and are on track to end the Northern Hemisphere winter at an exceptionally high level.
Natural Gas Technical Analysis
Technically, natural gas tried with its gains yesterday to compensate for part of what it incurred from previous losses. At the same time, it was trying to drain some of its clear selling saturation with the relative strength indicators, especially with the start of a positive crossover in them, considering the dominance of the bearish corrective trend in the short term along the slope line. Negative pressure continued its trading is below the simple moving average for the previous 50-day period.
Therefore, our expectations suggest that natural gas will return to decline during its upcoming trading, as long as it stabilizes below the 4.741 resistance level, to target the pivotal 3.618 support level.
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