

Nat gas prices saw a volatile week of trading last week with prices surging Wednesday before reversing sharply on Thursday amid long liquation and the season’s first injection. The spot month contract held onto nearly all of Thursday’s losses during Friday’s trade, ending with a 12.4 cent loss week over week. Losses stabilized on Friday with support from rising LNG feedgas demand offsetting broader weakness heading into shoulder season. The Apr contract settled a half cent higher at $3.98.

Production levels have ticked higher, coming in this morning at 106.2 BCF/day. The uptick is likely being driven by the New Mexico portion of the Permian Basin which is helping offset declines in other subregions. Month to date, output is averaging 105.5 BCF/day, up 3.7 BCF/day from last year.
Record warmth is forecast for the entire western US into Texas over the next 5 days. The heat is expected to subside during the 6-10 day period which features above to much above normal readings from the lower Midwest to the Mid-Atlantic and South while the West Coast will see normal to below normal temps. Highs will range from the mid 60’s in the Midwest to mid 70’s along the East Coast. The 11-15 day outlook features above normal readings from the Plains to the East with much above normal temps from the lower Midwest to the Mid-Atlantic and South.

Prices are trading lower this morning as long liquidation continues following an early start to injection season while weather forecasts indicate light demand, resulting in stronger than normal injections.
Technical Analysis

The April 25 natural gas contract closed lower on a weekly basis for a 2nd consecutive week on Friday settling the day at 3.980. For the week, the contract was down .124 (3%).
The April contract traded under 4.000 support last week testing the 40 day moving average on Friday and again today at the 3.875 level (3.862 current low).
A close under the 40 day moving average will turn the primary trend back down with the 38% retracement of the 2024-2025 uptrend at 3.380 becoming the next downside objective.
The 10 day moving average at 4.095 is near term resistance. Longer term resistance is last week’s 4.259 high followed by the 4.901 high set two weeks ago.
Moving Average Alignment – Bullish
Long Term Trend Following Index – Bullish
Short Term Trend Follow Following Index - Bearish
Relative Strength Index - 47.39






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