Natural gas prices see-sawed last week, straddling a technical retracement zone before closing lower. The market has essentially been rangebound since early August when traders decided that summer had come to early end.
November Natural Gas futures settled last week at $3.007, down $0.014 or -0.46%.
Sure we saw a spike up to $3.214 the week-ending September 22, the market’s highest level since mid-July. However, I contend that the uncertainty created by Hurricanes Harvey and Irma may have had something to do with that.
With conditions returning to near normal, I expect the weather to take on added importance. Typically in the key demand areas at this time of year, the weather is mild. It’s neither too hot nor too cold so demand could be on the low side.
To recap last week, according to the EIA, weekly storage during the week-ending September 22 grew by 58 billion cubic feet. Traders were looking for a build of about 66 bcf.
The previous week, the report showed a gain of 97 bcf, a build of 49 bcf a year earlier and a five-year rise of 84 bcf.
Total natural gas in storage currently stands at 3.466 trillion cubic feet, according to the EIA, about 3.5% lower than levels at this time a year ago and mostly in line with the five-year average for this time of year.
Forecast
According to natgasweather.com for the October 1 to October 5 time period, traders should look for temperatures to drop slightly below normal from the Great Lakes to the Northeast. Additionally, temperatures are expected to be comfortable in the South.
Heat could return to the Northeast resulting in slightly normal demand, but overall, national demand will be easing to moderate.
Although I expect the market to be mostly rangebound, we could see strength on a sustained move over $3.050 and weakness on a sustained move under $3.011.
This article was originally posted on FX Empire
More From FXEMPIRE:
-
Commodities Technical Analysis, October 2nd – October 6th, 2017
-
Natural Gas Price Fundamental Weekly Forecast- Rangebound; Bullish Over $3.050, Bearish Under $3.011
-
Natural Gas Price forecast for the week of October 2, 2017, Technical Analysis
-
Natural Gas Price Forecast October 2, 2017, Technical Analysis