Could Natural Gas See a Comeback?



Natural gas prices

On April 17, 2018, natural gas May 2018 futures fell 0.5% and settled at $2.738 per MMBtu (million British thermal units). However, between April 10 and April 17, 2018, natural gas May futures rose 3.1%. Unseasonal cold weather could be behind natural gas’s rise over this time period.

In the seven calendar days to April 17, 2018, energy stocks Southwestern Energy Company (SWN) rose 0.7%. SWN operate with a production mix of at least 60% in natural gas based on their latest quarterly production data.

In the trailing week, the United States Natural Gas ETF (UNG) and the ProShares Ultra Bloomberg Natural Gas ETF (BOIL)natural-gas-tracking ETFs, rose 3% and 5.2%, respectively.

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A comeback for natural gas?

The rise in the oil rig count could hold natural gas’s upside, which we’ll discuss in the next part. Moreover, in part three, we’ll look at the change in inventory levels, which might help natural gas prices to rise further. In part four, we’ll analyze market sentiments for the natural gas supply situation.

Moving averages

On April 17, 2018, natural gas active futures closed 2.2% and 2.1% above their 20-day and 50-day moving average. However, on the same date, natural gas active futures were 3.2% and 5.5% below the 100-day and 200-day moving averages. Natural gas prices above short-term moving averages could be a positive development for natural gas prices.


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