What to Expect from Natural Gas Next Week

Rabindra Samanta - Author

Nov. 20 2020, Updated 12:02 p.m. ET

Implied volatility

On January 18, 2018, natural gas’s implied volatility was 53.9%, 10.2% above its 15-day average.

A surge in asset prices can result in higher implied volatility. For example in the trailing week, natural gas (GASL) (GASX) futures rose 3.4% and implied volatility also rose 9.7%.

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Natural gas prices

There’s a 68% chance natural gas futures could settle between $2.95 and $3.43 per MMBtu between now and January 25, 2018. The forecast is based on the assumption that prices are normally distributed and natural gas’s latest implied volatility of 53.9%.

On January 18, 2018, natural gas prices settled at $3.19 per MMBtu. On January 13, natural gas futures closed at $3.42, the highest closing level since 2017. Higher natural gas prices could have a positive effect on the United States Natural Gas ETF (UNG), the ProShares Ultra Bloomberg Natural Gas (BOIL), and the First Trust ISE-Revere Natural Gas ETF (FCG) because they have exposure to natural gas futures. For more analysis on natural gas prices, check out our Energy and Power page.


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