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Price action reflects clear downward pressure. May futures are now trading below the 50-day moving average of $3.866, reinforcing a bearish intermediate trend. The daily chart points to pivot resistance near $3.935 and support around $3.361, with yesterday’s low of $3.600 acting as a key trigger. A break below that level could accelerate selling.
Will Cold Weather Offer Short-Term Demand Support?
A lingering chill over the Great Lakes and Northeast is helping support residential and commercial demand through midweek. NatGasWeather forecasts below-normal temperatures with highs in the 40s–50s and lows in the 20s–30s. However, national demand is expected to weaken significantly by the weekend as warmer conditions settle in across the southern and central U.S., resulting in overall low demand through late April. Without stronger weather-driven demand, bullish momentum remains limited.
Did the Latest Storage Build Shift Market Sentiment?
Yes. Last week’s EIA report showed a 29 Bcf injection into storage—well above the five-year average draw for that period. While overall inventories remain 21.5% lower than a year ago and 4.3% below the five-year average, the early-season build has reset trader expectations. The report suggests that milder temperatures and surplus supply are starting to rebuild stockpiles earlier than anticipated, adding further weight to the bearish tone.
Can LNG Exports Provide a Safety Net?
LNG exports continue to offer background support, with feedgas flows near 15.5 Bcf/d. While marginally lower than the prior week, flows remain robust. Longer-term prospects have improved following the administration’s move to expedite LNG project approvals. Still, in the near term, exports are not enough to counterbalance soft domestic demand and rising inventory levels.
Market Forecast
The near-term outlook for natural gas remains bearish. With technical indicators flashing downside risk, seasonal demand slipping, and storage injections starting early, the path of least resistance is lower. Unless colder-than-expected weather or a sudden drop in supply materializes, May futures are likely to test support levels in the days ahead.
More Information in our Economic Calendar.
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