Natural Gas Price Prediction – Prices Form Bull Flag Pattern as Storm Brews in the Atlantic
Natural gas prices moved higher on Tuesday and are forming a bull flag pattern. There is a disturbance in the Atlantic that now has a 90% chance of forming a tropical cyclone according to the National Oceanic Atmospheric Administration (NOAA). The weather is expected to be cooler than normal for most of the mid-west over the next 2-weeks which could ease cooling demand. US LNG exports remain at depressed levels according to a recent report from the Energy Information Administration.
Technical Analysis
Natural gas prices are forming a bull flag continuation pattern which is a pause that refreshes higher. Support is seen near the 10-day moving average seen near 2.08. Resistance is seen near a downward sloping trend line that comes in near 2.27. The 10-day moving average crossed above the 50-day moving average which means that a short-term uptrend is now in place. Momentum is neutral as the fast stochastic moves sideways. The current reading on the fast stochastic is 83, just above the overbought trigger level of 80, which could foreshadow a correction.
LNG Exports Remain Subdued
LNG exports hit a record high of 8.0 billion cubic feet per day in January 2020, but since exports of liquefied natural gas fell to an average of 3.1 Bcf per day in July 2020. July exports were similar to LNG exports in May 2018, when the available liquefaction capacity was about one-third of the current capacity.
This article was originally posted on FX Empire
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