Natural gas prices recovered from the daily lows, initially dropping to 2.15 but still falling 3.7% during the day. This is due to an unexpectedly sharp decline in natural gas inventories, which the Ministry of Energy reported one day late due to the Christmas holidays. The weather is expected to be warmer than normal in the next 6 to 10 days, and then to return to normal in the next 8 to 14 days, according to the National Oceanic Atmospheric Administration.
Natural gas prices recovered strongly, but fell by almost 4% in the reporting period. Resistance is seen near the 10-day moving average at 2.27, which is in line with the latest breakdown level. Support is seen near the December lows at 2.15, which coincides with the monthly lows. The momentum is neutral to negative. The Moving Average Convergence Divergence (MACD) index generated a crossover sell signal. The MACD histogram is printed in red with a flat trajectory that indicates consolidation.
Inventories are falling more than expected
According to estimates by the EIA on Friday, December 20, 2019, the stored natural gas reserves were cf. 3,250 billion.This corresponds to a net decrease of 161 Bcf compared to the previous week. According to the survey provider, expectations for a decrease of 119 Bcf fell. At this point in time, the shares were 518 Bcf higher than in the previous year and 69 Bcf below the five-year average of 3,319 Bcf. At 3,250 Bcf, the total working gas is in the historic five-year range.
This article was originally published on FX Empire