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Will the 50-Day Moving Average Hold Up?
The 50-day moving average at $3.858 is now the key line in the sand for bulls. A confirmed break below this level could accelerate selling and trigger a move toward $3.361. With price momentum now on the back foot and technical structure weakening, traders are eyeing whether this crucial support zone can offer any buying interest, or if it opens the door for deeper retracements.
Weather Outlook Points to Light Demand
Near-term demand is not offering support either. According to NatGasWeather, temperatures across the U.S. from April 3–9 are expected to range from 30s to 60s in northern regions, with milder conditions—mid-50s to 80s—covering much of the South and East. A brief cool shot will arrive late this weekend, but overall national demand is projected to remain moderate to occasionally low. This weak heating demand adds further weight to the bearish bias.
Storage Data Reinforces Bearish Sentiment
The latest EIA report added to the bearish pressure. For the week ending March 28, natural gas storage rose by 29 Bcf, outpacing the +28 Bcf estimate and sharply diverging from the 5-year average draw of -13 Bcf. While inventories remain tight compared to last year—down 491 Bcf, or 21.5%—and are 4.3% below the five-year average, the size of the injection in a typically withdrawal-heavy period underscores the impact of mild weather and muted demand.
In Europe, storage was reported at just 34% full as of April 1, trailing the 5-year seasonal average of 45%, but this has yet to provide meaningful support to U.S. prices.
Short-Term Outlook: Bearish Bias Builds
With the market breaching technical pivots, low near-term demand, and a bearish storage print, the short-term outlook leans bearish. Unless weather turns materially colder or the 50-day moving average holds and triggers a bounce, traders should prepare for additional downside risk toward the $3.36 area.
More Information in our Economic Calendar.
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