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Despite Thursday’s 27.2-cent drop in the prompt month, futures held above pivot support near $3.924 and attempted to stabilize early Friday. Technical charts show a rangebound setup, with resistance capped at $3.322 and downside risk intensifying if $3.924 breaks. A clean breach could trigger a drop to the 50-day moving average at $3.767, where some traders expect a bounce. Failure there may open the door to $3.350.
The technical setup suggests a market still trying to find direction, but vulnerable to further weakness unless demand signals improve. Range compression could soon lead to increased volatility.
What’s the Demand Outlook from Weather Models?
The latest weather models show light national demand for at least the next seven days. While some systems will bring cooler air and precipitation to the eastern and western U.S., much of the country is forecast to experience seasonal to above-normal temperatures. With highs ranging from the 50s to 80s across most regions, residential and commercial heating demand is expected to remain tepid.
Market Forecast: Bearish Near-Term Bias
With the first injection of the season arriving earlier than usual, weather-driven demand staying weak, and strong technical resistance capping upside moves, the short-term outlook for natural gas remains bearish. Unless temperatures drop significantly or LNG export volumes provide a surprise lift, prices are likely to test lower technical levels in the near term.
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