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The market’s immediate technical focus is the $3.924 level. A sustained hold above this pivot could stabilize prices in the short term, though a major hurdle remains at $4.322. A break under $3.924 would target the 50-day moving average at $3.780. This level has offered consistent support since December, but a high-volume breakdown could trigger a deeper slide toward $3.350.
Storage Injection Signals Early Transition to Refill Season
The U.S. Energy Information Administration surprised traders with a 9 Bcf build for the week ending March 14 — the first injection of the year. This development was particularly bearish, as the market had expected a small draw or flat number. The build reflected reduced heating demand, with wind and solar generation easing reliance on gas-fired electricity. Although inventories remain below average, the early start to the refill season points to slack demand and limited upside potential.
Weather Undercuts Late-Season Demand Expectations
Warmer-than-normal conditions persist across key regions, suppressing residential and commercial gas consumption. Forecasts show widespread temperatures in the 50s to 80s, with no significant cold events on the horizon. While brief cold fronts are expected, they lack the scale to meaningfully lift demand. With heating demand fading, the market is entering the shoulder season with little support from the weather front.
Exports Offer Support, But Bears Maintain Control
On the supply side, U.S. dry gas output remains strong, keeping the market well-supplied. LNG exports have climbed to 16.0 Bcf/d, providing a modest tailwind. However, rising exports and sub-average inventories are being outweighed by weak domestic demand and early inventory builds. Without a new catalyst, bulls are struggling to regain control.
Short-Term Outlook: Bearish Bias Persists
With soft demand, mild weather, and early inventory additions driving sentiment, the near-term bias remains bearish. Unless a cold snap or meaningful production decline materializes, prices are likely to test lower support levels. A breakdown below $3.924 could accelerate selling, putting $3.780 and potentially $3.350 in play.
More Information in our Economic Calendar.
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