Natural gas prices rallied sharply, rising more than 3.2% and demand continues to outstrip supply. The weather is expected to remain warmer than average throughout most of the United States during the next two weeks. Warm weather should increase cooling demand during a period when the weather is expected to become milder. Tropical storm Sam has formed in the Atlantic but its unlikely to impact any natural gas infrastructure.
Natural gas prices surged, rising 3.2%, closing above resistance that is now support near the 10-day moving average at 5.09. Additional support is seen near the 50-day moving average at 4.33. Resistance is seen near the September highs at $5.65. Short-term momentum has turned positive as the fast stochastic recently generated a crossover buy signal. Medium-term negative momentum is decelerating as the MACD histogram is printing in negative territory with a rising trajectory which points to consolidation.
The EIA sees More Demand
The EIA reports that the industrial sector of natural gas consumption will rise throughout 2021 and exceed pre-pandemic 2019 levels. They forecast that growth to continue into 2022, and natural gas delivered to industrial consumers will average 23.8 billion cubic feet per day that year. If realized, this amount would be near the current record high for annual industrial natural gas consumption set in the early 1970s
This article was originally posted on FX Empire