Yahoo Finance Natural Gas Price Fundamental Daily Forecast – New Weather Forecasts Quell Early Cooling Demand Fears
Natural gas futures retreated on Monday as investors priced in revisions to weather forecasts that are likely to cap early cooling demand.
July Natural Gas futures settled at $2.850, up $0.029 or -1.02%.
National Weather Service outlooks show above-average temperatures across the whole U.S. except for the Southeast in the six-to-10-day period, but receding to encompass just a little more than the western half of the country in the eight-to-14-day period.
In an updated forecast for May 21 – May 27 from NatGasWeather.com, “Numerous weather systems will bring areas of heavy showers across the country the next few days, focused over the West and Southeast, although with only minor cooling. The northern U.S. will be mild to warm with highs of upper 60s to near 80 degrees Fahrenheit, while the southern U.S. will be very warm with 80s and 90s, with the hottest over the far Southwest and Texas. Next weekend will be warmer than normal across most of the country but still with areas of heavy showers, especially over the southern U.S. Overall, demand will be low to locally moderate.”
Forecast
After making the price adjustment on Monday, prices are rebounding early Tuesday. At 1022 GMT, July Natural Gas is trading $2.873, up 0.023 or +0.81%.
The trend is up on the daily chart. A trade through $2.901 will signal a resumption of the uptrend with $2.919 the next likely upside target. A trade through $2.804 will change the main trend to down.
The short-term range is $2.804 to $2.901. Its 50% level or pivot at $2.853 was tested on Monday and provided support earlier today.
Look for an upside bias today as long as natural gas hold above $2.853. If this move creates enough upside momentum then look for the rally to extend into $2.901.
The inability to hold $2.853 will signal increased selling pressure. This could lead to a test of $2.841. A failure to hold this level could trigger an acceleration to the downside.
This article was originally posted on FX Empire
