Natural gas futures
Cold weather and bullish natural gas inventories data could have helped the recovery in natural gas prices in the trailing week. However, a possible rise in the oil rig count could increase concerns about natural gas supplies.
On January 2, 2018, natural gas active futures’ implied volatility rose to the highest level since November 15, 2016. The implied volatility and prices have risen simultaneously. High implied volatility could make prices more volatile.
Between December 26, 2017, and January 2, 2018, natural gas prices rose 15.1%. The S&P 500 Index (SPY) and the Dow Jones Industrial Average Index (DIA) rose 0.6% and 0.3%, respectively. A gain of 0.7% in US crude oil (USO) prices during this period would be more relevant for these equity indexes—compared to the recovery in natural gas prices.
On January 2, natural gas active futures were 10.1%, 4.7%, 4%, and 1.6% above their 20-day, 50-day, 100-day, and 200-day moving averages, respectively. The 50-day moving average was 2.9% below the 200-day moving average. If the 50-day moving average moves above the 200-day moving average, natural gas prices will be more bullish—like crude oil.