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Daily Natural Gas Market Update 6-12-25

By: Heather Wine, Senior Risk Manager - Energy

Daily Natural Gas Market Update
 
Heather Wine
 
Senior Risk Manager | (312) 373-8250StoneX Financial Inc. - FCM Division Heather.Wine@stonex.com 
StoneX Value Matrix
image-20250612073006-3
Source: StoneX Value Matrix (2), Bloomberg
StoneX Commodity Indicator
image-20250612072904-2
 
Source:  StoneX Commodity Indicator (1), Bloomberg
Fundamentals & Weather

With an early session rally failing to hold, July nat gas closed down modestly yesterday driven by above normal injection forecasts.  Bearish sentiment was tempered somewhat by forecasts showing hotter weather arriving later this month while production levels remained steady.  The July contract settled down 2.6 cents at $3.507.

image 114116
Source: Bloomberg, CME

Production has trended lower this week since hitting more than 106 BCF/day on Monday.  We should see a further recovery as pipeline maintenance winds down. Dry natural gas production is averaging 105 BCF/day so far this month. The EIA is forecasting dry output to average 106 BCF/day this year, up about 3 BCF/day from 2024.  

image 114117​​​​
Source: NOAA

Continuing the streak of triple digit builds, today’s storage report is projected to show stocks increased by 108 BCF during the week ended June 6.  This compares to last year’s build of 77 BCF and the 5 yr avg build of 87 BCF.  If correct, stocks would rise to 2.706 TCF, expanding the 5 yr avg surplus to 143 BCF.  Early estimates for next week’s report covering the week ending June 13 range from a build of 83 to 111 BCF with an average increase of 102 BCF.  This would once again outpace both last year and the 5 yr avg builds of 72 BCF each.  

image 114118
Source: Bloomberg

Prices are trading higher this morning as near term forecasts turn more supportive with expanding coverage of above normal temps during the 6-10 day period.

LNG feedgas demand is also strengthening, estimated this morning at 15 BCF/day, up 0.5 BCF/day.  The rebound is being aided by a recovery at the Cameron LNG terminal as maintenance wraps up.

Technical Analysis

 

image-20250612073156-4
Source: Bloomberg, CME

The July 25 natural gas contract closed down for a 3rd consecutive session on Wednesday settling the day at 3.507, down .026.

The gap created last Monday at 3.450 was closed on Wednesday with prices rebounding in today’s early trade.

The 10 day moving average which held as resistance on Wednesday is being tested again in today’s early trade at 3.630 with a current 3.644 overnight high.

If 10 day moving average resistance is broken, it should bring in both short-covering and new technical buying turning last Friday’s 3.817 high into the next upside resistance.

If 10 day moving average resistance holds, Wednesday’s 3.453 low extending down to the 40 day moving average at 3.420 will remain primary resistance.

A breakout under 3.420 will turn the 200 day moving average at 3.300 into the next area of support followed by 3.200 which is the bottom of the gap on the 60-minute chart created during expiration of the June 25 contract.  As long as this gap remains open, it will be a bearish technical signal.

Trend following indicators remain bullish but 10, 40 and 200 day moving average alignment has turned neutral-bullish with 10 day moving average support broken this week.

Moving Average Alignment – Neutral-Bullish
Long Term Trend Following Index – Bullish
Short Term Trend Follow Following Index - Bullish

Relative Strength Index - 52.09

image 114122
Source: Bloomberg, CME
image 114121
Source: Bloomberg, CME
image 114120
Source: Bloomberg, CME
image 113457
Source: Bloomberg, CME, StoneX Value Matrix (2)
image 113456
Source: Bloomberg, CME, StoneX Value Matrix (2)
Forward Curve Pricing
image 114119
Source: Bloomberg, CME
 
Disclaimer

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