Natural Gas Prices Surge to Fresh 13-Year Highs
Key Insights
Natural Gas prices broke out to new 13-year highs and are poised to test higher levels.
Inventories unexpectedly declined
The weather is expected to be colder than normal in the U.S.
LNG arrivals at exports facilities rise
Natural gas prices surged higher on Thursday, breaking out to fresh 13-year highs. Inventories unexpectedly declined. The weather is expected to be much colder than normal on the West Coast and colder than normal throughout the United States for the next two weeks. Natural gas arrivals at LNG export termimals rose after falling for 3-consecutive days.
According to the Energy Information Administration, natural gas in storage was 1,382 Bcf as of April 1, 2022. This represents a net decrease of 33 Bcf from the previous week. Expectations were for a 8 Bcf rise in stockpiles, according to survey provider Estimize. Stocks were 399 Bcf less than last year at this time and 285 Bcf below the five-year average of 1,667 Bcf. At 1,382 Bcf, total working gas is within the five-year historical range.
Technical Analysis
On Thursday, natural gas prices broke out to fresh 13-year highs. Target resistance is seen near the July 2008 highs at 13.68. Support is seen near the 10-day moving average at 5.75.
Short-term momentum has turned positive as the fast stochastic generated a crossover buy signal. The fast stochastic is printing a reading of 97, above the overbought trigger level of 80.
Medium-term momentum has turned positive. The MACD (moving average convergence divergence) index makes a crossover buy signal. This scenario occurs when the MACD line (the 12-day moving average minus the 26-day moving average, crosses above the 9-day moving average of the MACD line.
This article was originally posted on FX Empire
