Natural gas prices moved lower on Tuesday declining as warmer than normal weather is expected to cover most of the United States for the next 6-10 and 8-14 days. Prices declined 2.4% on Tuesday after declining 4.5% on Monday and dropping nearly 4% in the prior week. Supplies rose in the latest week, and with the warm temperatures, there was additional downward pressure on prices.
Natural gas prices moved lower on Tuesday tumbling down to support levels that are now seen near 2.42 after breaking through the November lows at 2.52, which is now seen as short term resistance. Short term momentum is negative the fast stochastic accelerated lower with a downward sloping trajectory. The fast stochastic is now printing a reading of 2, well below the oversold trigger level of 20 which could foreshadow a correction. 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). The MACD histogram is printing in red with a declining trajectory which points to lower prices.
Supplies Continue to Rise
Supply continues to rise according to the EIA. The average total supply of natural gas rose by 1% compared with the previous report week. Dry natural gas production remained constant week over week. Average net imports from Canada increased by 19% from last week as imports from Canada into the Iroquois pipeline at Waddington in upstate New York rose more than 1 Bcf per day during the report week.
This article was originally posted on FX Empire
More From FXEMPIRE:
- Silver Price Forecast – Silver Markets Continue Forming Support
- Gold Price Prediction – Prices Consolidate Despite Robust US Housing Data
- Gold Price Forecast – Gold Markets Relatively Stable
- GBP/USD Price Forecast – British Pound Continues To Chop Around
- E-mini S&P 500 Index (ES) Futures Technical Analysis – Close Under 3121.75 Forms Closing Price Reversal Top
- GBP/USD, EUR/GBP, USD/CAD – Limited Gains for Euro, U.S. Dolllar