Natural gas prices moved lower on Thursday following the Energy Information Administration report on natural gas inventories. Stockpiles came out in line with expectations, allowing prices to initially slip and then rebound off there lows. Prices are poised to trade near $2.37 per mmbtu which would be the lowest prices for this time of year since 1998.
Natural gas prices eased on Thursday, moving lower and generating a lower low. Prices settled the session off the lows. Resistance is seen near the 10-day moving average at 2.39. Support is seen near the July lows at 2.21. Medium term momentum has turned negative as the MACD (moving average convergence divergence) index generated a crossover sell signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses below the MACD signal line (the 9-day moving average of the MACD line. Short term momentum remains negative as the fast stochastic slides lower. The current reading of 27 is at the lower end of the neural range.
Natural gas Inventories Rise in Line with Expectations
The Energy Information Administration reported that working gas in storage was 2,533 Bcf as of Friday, July 12, 2019. This represents a net increase of 62 Bcf from the previous week. This was in line with expectations based in the forecast from Estimize. The EIA also reported on Thursday that stocks were 291 Bcf higher than last year at this time and 143 Bcf below the five-year average of 2,676 Bcf. At 2,533 Bcf, the total working gas is within the five-year historical range. The increase in stocks relative to last year and rising production levels will likely continue to put downward pressure on prices.
This article was originally posted on FX Empire
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