Natural Gas Price Forecast – Price Rise on New Weather Forecast
Natural gas prices rose on Monday, rising 11%, as NOAA predicts La Nina conditions, which will generate a peak trough pattern. Temperatures are expected to be warmer than average in the southwest and cooler than normal in the northeast and center-west. Fresh air will occasionally descend from Canada and reach as low as Texas as it did last year. This phenomenon cut off electricity in Texas during one of the coldest periods of winter. Just before the withdrawal season, natural gas inventories are below average.
Natural gas prices have risen 11% and are poised to test higher levels. Resistance is visible near October highs at 6.69. Support is near the 10 day moving average at 5.58. Short-term momentum turned positive as the Rapid Stochastic generated a cross buy signal. Prices have risen rapidly from oversold levels. Medium-term momentum is negative but decelerates as the MACD (Moving Average Convergence Divergence) histogram prints in negative territory with an upward trajectory indicating consolidation.
La Nina will generate a ridge hollow pattern
The National Oceanic and Atmospheric Administration’s Climate Prediction Center has released its official winter forecast and has confirmed that La Niña conditions will be in place from December through February. This will likely create a ridge trough pattern that will see cooler air moving through the middle of the country.