Natural Gas Radar

2025-08-28 23:47

Table of Contents

Brian's Thoughts

Published: 08/28/2025 Focus: Natural Gas
Natural Gas closed off the week and looks destined for 2.449. With gaps existing at 3.449 and 2.449 - adding in the news that supply is on the uptrend (bear in mind it isn’t that much). The bigger story is the lack of power demand and tick down on LNG exports - those are weighing heavily. My end of season storage still sits at 3.8 TCF - but many respected analysts are toggling up to 4 TCF. Key levels to watch: 2.715 (pivot) with 2.66 and 2.525 as support and 2.762 and 2.799 as resistance. Breaking below 2.762 almost guarantees 2.449 gap fill.

Today's Update

Updated: 2025-08-28 23:46:32 Length: 480 chars
Natural Gas prices are currently navigating a downward trajectory, closing in on the critical level of 2.449. Recent market dynamics reveal an uptick in supply, but lagging power demand and a dip in LNG exports are pressing down on prices. The latest EIA report showed a less-than-expected inventory build, prompting a brief rally. Analysts forecast end-of-season storage approaching 4 TCF, while key levels to monitor include support at 2.525 and resistance at 2.762. Watch fo...

Executive Summary

Total supply increased by 0.5 BCFD | Total demand decreased by 2.0 BCFD | Market is oversupplied by 6.5 BCFD

Technical Analysis

Overall Technical Score (-5 to +5): -2 (Moderately Bearish)
Current Price: $2.97
Signal: Moderately Bearish

Moving Averages (9/20)

BEARISH

MA(9): $2.8

MA(20): $2.88

Current Price is 2.97, 9 day MA 2.8, 20 day MA 2.88

MACD (12, 26, 9)

BULLISH

MACD: -0.1024

Signal: -0.1257

Days since crossover: 2

MACD crossed the line 2 days ago and is in a bullish setup

RSI (14)

NEUTRAL

Value: 50.99

Category: NEUTRAL

RSI is 50.99 (note 70% is overbought and 30% is oversold)

Volume (vs 20d Avg)

LOWER

Current: 2,600

Avg (20d): 131,319

Ratio: 0.02

Volume is lower versus 20 day average

Stochastic (14, 3)

BULLISH CROSS

%K: 93.39

%D: 54.02

Stochastic %K: 93.39, %D: 54.02. Signal: bullish cross

ADX (14)

WEAK TREND

ADX: 24.46

+DI: 25.56

-DI: 23.13

ADX: 24.46 (+DI: 25.56, -DI: 23.13). Trend: weak trend

Williams %R (14)

OVERBOUGHT

Value: -6.61

Williams %R: -6.61 (overbought)

Bollinger Bands (20, 2)

ABOVE MIDDLE

Upper: 3.13

Middle: 2.88

Lower: 2.64

Price vs BBands (20, 2): above middle. Upper: 3.13, Middle: 2.88, Lower: 2.64

Fundamental Analysis

Category Current (BCFD) Last Week Last Year 3 Yr Avg
Dry Production 107.4 106.7 101.3 100.1
LNG Imports 0.0 0.0 0.1 0.1
Canadian Imports 5.2 5.1 6.4 5.63
Total Supply 112.6 111.9 107.8 105.8
Industrial Demand 21.7 22.1 21.5 21.4
Electric Power Demand 45.7 41.0 43.7 42.37
Residential & Commercial 8.9 9.2 7.9 8.3
LNG Exports 15.5 16.3 12.6 11.93
Mexico Exports 7.3 7.1 6.9 6.23
Pipeline Fuel 7.0 6.9 6.7 6.77
Total Demand 106.1 102.5 99.2 96.97
Supply/Demand Balance 6.5 9.4 8.6 8.83

Weather Analysis

Weather Impact Summary

Overall: COOLING dominated (HDD: 2.5, CDD: 7.7)
Residential/Commercial: LOW heating demand expected
Power Generation: MODERATE cooling demand expected

Regional Weather Patterns

Northeast

Heating dominated (HDD: 1.0)

Midwest

Heating dominated (HDD: 10.5)

South

Cooling dominated (CDD: 12.0)

West

Cooling dominated (CDD: 26.5)

Degree Days by City

Chicago, IL

Heating Degree Days (HDD): 10.5
Cooling Degree Days (CDD): 0.0
Total HDD: 18.5
Total CDD: 38.0

New York, NY

Heating Degree Days (HDD): 0.5
Cooling Degree Days (CDD): 0.0
Total HDD: 0.5
Total CDD: 45.0

Houston, TX

Heating Degree Days (HDD): 0
Cooling Degree Days (CDD): 12.0
Total HDD: 0
Total CDD: 142.5

Los Angeles, CA

Heating Degree Days (HDD): 0
Cooling Degree Days (CDD): 26.5
Total HDD: 0
Total CDD: 231.0

Philadelphia, PA

Heating Degree Days (HDD): 1.5
Cooling Degree Days (CDD): 0.0
Total HDD: 1.5
Total CDD: 48.0

Economic Analysis

Economic Sentiment Summary

POSITIVE - Economic indicators generally supportive
Dollar Impact: Weaker USD may support commodity prices
Industrial Demand: Strong industrial demand signals
Interest Rate Impact: Stable/lower rates may support demand
Risk Sentiment: Low market volatility/risk appetite

Economic Indicators

USD_INDEX

98.0
Daily: -0.23 (-0.23%)
Weekly: 0.28 (0.29%)

US_10Y

4.21
Daily: -0.03 (-0.73%)
Weekly: -0.05 (-1.24%)

SP500

6501.86
Daily: 20.46 (0.32%)
Weekly: 34.95 (0.54%)

VIX

14.43
Daily: -0.42 (-2.83%)
Weekly: 0.21 (1.48%)

GOLD

3471.3
Daily: 66.7 (1.96%)
Weekly: 96.9 (2.87%)

COPPER

4.55
Daily: 0.13 (3.05%)
Weekly: 0.1 (2.28%)

CFTC Commitment of Traders Analysis

Natural Gas Positioning (NAT GAS NYME - NEW YORK MERCANTILE EXCHANGE)

Report Date: 2025-08-19
Sentiment: Bearish but Weakening
Positioning: Normal Range

Open Interest

1,603,770
Change: -14,321

Managed Money

-36,687
Change: +14,046
-2.3% of OI

Producer/Merchant

-17,771
Change: +12,483
-1.1% of OI

Swap Dealers

105,233
Change: -2,235
6.6% of OI

Other Reportables

-68,401
Change: -22,088
-4.3% of OI

Analysis Rationale (Managed Money):

  • Managed Money sentiment: bearish but weakening

Crude Oil Positioning (WTI-PHYSICAL - NEW YORK MERCANTILE EXCHANGE)

Report Date: 2025-08-19
Sentiment: Bullish but Weakening
Positioning: Normal Range

Open Interest

1,922,821
Change: -88,138

Managed Money

27,445
Change: -21,420
1.4% of OI

Producer/Merchant

297,794
Change: -2,118
15.5% of OI

Swap Dealers

-438,348
Change: +3,854
-22.8% of OI

Analysis Rationale (Managed Money):

  • Managed Money sentiment: bullish but weakening

LNG Market Analysis

LNG Market Summary

TTF prices decreased to 11.219 EUR/MWh (-0.035). JKM prices decreased to 11.310 USD/MMBtu (-0.180). JKM is trading at a premium of 0.091 to TTF, indicating strong Asian demand.

TTF Prices

11.219

-0.035

Front month: SEP 25

As of 2025-08-28

JKM Prices

11.310

-0.180

Front month: OCT 25

As of 2025-08-28

JKM-TTF Spread

0.091

0.81%

JKM is trading at a premium to TTF, indicating strong Asian demand.

As of 2025-08-28

Forward Curves Visualization
TTF (EUR/MWh)
JKM (USD/MMBtu)
12.0
11.6
11.3
10.9
10.6
11.22
11.31
SEP 25
11.14
11.39
OCT 25
11.40
11.71
NOV 25
11.55
11.88
DEC 25
11.61
11.84
JAN 26
11.61
11.48
FEB 26
11.45
10.95
MAR 26
10.88
10.81
APR 26
10.72
10.90
MAY 26
10.68
11.02
JUN 26
10.69
11.11
JUL 26
10.74
11.20
AUG 26
TTF Forward Curve (Next 12 Months)
Month Price (EUR/MWh)
SEP 25 11.219
OCT 25 11.138
NOV 25 11.405
DEC 25 11.551
JAN 26 11.608
FEB 26 11.607
MAR 26 11.449
APR 26 10.882
MAY 26 10.722
JUN 26 10.682
JUL 26 10.694
AUG 26 10.742
JKM Forward Curve (Next 12 Months)
Month Price (USD/MMBtu)
OCT 25 11.310
NOV 25 11.390
DEC 25 11.710
JAN 26 11.875
FEB 26 11.840
MAR 26 11.480
APR 26 10.945
MAY 26 10.815
JUN 26 10.905
JUL 26 11.015
AUG 26 11.110
SEP 26 11.195

News & Sentiment Analysis

Market Sentiment Overview

BULLISH
Average Polarity: 0.5
Confidence: 1.0
Articles Analyzed: 86
Last Updated: 2025-08-28 23:47:14

Commodity Sentiment

NATURAL_GAS

0.4

CRUDE_OIL

0.6

Top News Topics

Supply (13 articles)

Demand (5 articles)

Infrastructure (2 articles)

Geopolitical (7 articles)

Weather (1 articles)

Fibonacci Levels Analysis

Current Price: $2.97
Closest Support: $2.62 11.78% below current price
Closest Resistance: $2.98 0.34% above current price

Fibonacci Retracement Levels

0.0 $2.62 Support
0.236 $2.98 Resistance
0.382 $3.2
0.5 $3.38
0.618 $3.57
0.786 $3.82
1.0 $4.15

Fibonacci Extension Levels

1.272 $4.56
1.618 $5.09
2.0 $5.67
2.618 $6.62

ML Price Prediction

Current Price: $2.94
Forecast Generated: 2025-08-28 23:47:14
Next Trading Day: UP 0.27%
Date Prediction Lower Bound Upper Bound
2025-08-29 $2.95 $2.77 $3.14
2025-08-30 $2.96 $2.78 $3.14
2025-08-31 $2.96 $2.78 $3.15
2025-09-01 $2.95 $2.77 $3.14
2025-09-02 $2.95 $2.76 $3.13

ML Insights

  • Forecast generated using ARIMA(5, 1, 0).
  • The model predicts a price increase of ~0.27% for the next trading day (2025-08-29), reaching $2.95.
  • The 5-day forecast suggests relatively stable prices between 2025-08-29 and 2025-09-02.
  • The average confidence interval width is ~12.5% of the predicted price, indicating model uncertainty.
  • SIGNAL: Weak bullish signal, high uncertainty.

AI Analysis

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For Energy Traders:

Current market indicators suggest a moderately bearish outlook with a technical score of -2/5. Key Fibonacci support is at 2.62, while resistance is at 2.98. The ML price forecast for the next day indicates a slight increase of 0.27%, suggesting potential short-term opportunities within the range of 2.77 to 3.14. Traders should remain vigilant for volatility and consider the implications of the overall market sentiment score of +0.400.

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For Producers (Oil & Gas Companies):

The fundamental balance at 6.50 BCFD with a change of +2.50 indicates a tightening supply, which could support pricing in the longer term. However, the technical indicators suggest caution, as the market sentiment remains mixed. Producers should consider adjusting their hedging strategies to mitigate potential price declines while capitalizing on the news sentiment surrounding natural gas. Monitoring inventory levels and adjusting production schedules may also be prudent given the expected low heating demand in the residential and commercial sectors.

🏭

For Consumers (Industrial/Utilities):

With the weather outlook indicating low heating demand and moderate cooling demand, consumers can expect relatively stable supply conditions. However, the technical outlook may suggest potential fluctuations in pricing. The fundamental balance indicates a slight increase in supply, which could help stabilize costs in the near term. Consumers should consider hedging options to protect against any unexpected price movements driven by market sentiment or geopolitical factors.

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For Commodity Professionals (Analysts, Consultants):

The current market landscape reflects a moderately bearish technical outlook alongside a positive market sentiment score of +0.400. Key drivers include a fundamental balance of 6.50 BCFD and a weather forecast favoring cooling demand, particularly in the southern and western regions. Analysts should keep an eye on the ML price forecast indicating a potential uptick, while also considering the impact of geopolitical tensions on crude oil prices. Overall, the market shows signs of divergence, warranting close monitoring for potential shifts in sentiment and pricing dynamics.

Disclaimer: This analysis is for informational purposes only and should not be considered as financial advice or specific buy/sell recommendations.

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