Nat Gas continues to have bullish forecasts- but after December 5th - we are seeing the HDDs dropping….that is not a good sign for bulls. The technical move to $5 is astounding - I expected $5 back in October - but felt this move was WAAAYYY too premature - I want to see the fundamental support - and right now we are more “average” while a move from $4 to $4.90 is not average - the two things can not coexist. At this point, I am halfway expecting a sharp reversal during December - and this will thrust us back down in a big BIG way - like $1-1.50. That said - if the forecasts live up to expectations - we will need to see significant follow through to really see any more upside. This week has been a battle and needless to say it has looked to be at the hands of the bulls for the most part (though the bears had some times that looked like they were going to take control). Let’s be real - the next 4 weeks are cold and really solid cold likely to take 100+ BCF more than the 5 year average, but we are currently 150+ BCF over the 5 year average so is it $5 bullish (the highest prices we have seen since the 2022 spike)? If weather continues to come in cold in late Dec / early Jan - we could see follow through to $6 but we may be sizing up for a big correction down.
ER
Natural Gas Radar
2025-12-04 23:47
Table of Contents
Brian's Thoughts
Today's Update
Natural gas prices have soared recently, hitting a three-year high as cold temperatures sweep across the U.S. However, despite a bullish forecast, concerns arise with the onset of declining Heating Degree Days (HDDs) post-December 5th, suggesting a potential reversal. Current inventory levels remain over 150 BCF above the five-year average, posing questions on sustaining the $5 mark. Traders should monitor weather patterns and storage figures closely, as a significant correction could loom if colder forecasts don’t materialize.
Executive Summary
Total supply increased by 0.7 BCFD | Total demand increased by 25.83 BCFD | Market is undersupplied by 34.03 BCFD
Technical Analysis
Overall Technical Score (-5 to +5):
1
(Neutral)
Current Price:
$5.08
Signal:
Neutral
Moving Averages (9/20)
BULLISH
MA(9): $4.75
MA(20): $4.59
Current Price is 5.08, 9 day MA 4.75, 20 day MA 4.59
MACD (12, 26, 9)
BULLISH
MACD: 0.3012
Signal: 0.2865
Days since crossover: 2
MACD crossed the line 2 days ago and is in a bullish setup
RSI (14)
OVERBOUGHT
Value: 71.93
Category: OVERBOUGHT
RSI is 71.93 (note 70% is overbought and 30% is oversold)
Volume (vs 20d Avg)
LOWER
Current: 4,987
Avg (20d): 165,708
Ratio: 0.03
Volume is lower versus 20 day average
Stochastic (14, 3)
OVERBOUGHT
%K: 97.01
%D: 90.77
Stochastic %K: 97.01, %D: 90.77. Signal: overbought
ADX (14)
STRONG UPTREND
ADX: 43.51
+DI: 32.51
-DI: 9.98
ADX: 43.51 (+DI: 32.51, -DI: 9.98). Trend: strong uptrend
Williams %R (14)
OVERBOUGHT
Value: -2.99
Williams %R: -2.99 (overbought)
Bollinger Bands (20, 2)
BREAKOUT UPPER
Upper: 5.04
Middle: 4.59
Lower: 4.15
Price vs BBands (20, 2): breakout upper. Upper: 5.04, Middle: 4.59, Lower: 4.15
Fundamental Analysis
| Category | Current (BCFD) | Last Week | Last Year | 3 Yr Avg |
|---|---|---|---|---|
| Dry Production | 108.5 | 108.5 | 103.0 | 103.23 |
| LNG Imports | 0.0 | 0.0 | 0.0 | 0.07 |
| Canadian Imports | 7.0 | 6.3 | 6.6 | 6.0 |
| Total Supply | 115.5 | 114.8 | 109.7 | 109.33 |
| Industrial Demand | 25.9 | 20.1 | 25.9 | 25.1 |
| Electric Power Demand | 39.6 | 32.4 | 36.3 | 32.57 |
| Residential & Commercial | 50.1 | 37.0 | 45.2 | 39.2 |
| LNG Exports | 18.7 | 19.0 | 14.5 | 13.47 |
| Mexico Exports | 6.4 | 6.4 | 5.9 | 6.0 |
| Pipeline Fuel | 8.83 | 8.83 | 8.0 | 7.7 |
| Total Demand | 149.53 | 123.7 | 135.9 | 124.0 |
| Supply/Demand Balance | -34.03 | -8.9 | -26.2 | -14.67 |
Weather Analysis
Natural Gas Weather Impact:
HIGH heating demand - significant cold spell (ABOVE normal heating demand)
(Heating-dominated conditions driving natural gas demand)
Weather Analysis Summary
Heating Degree Days (Utility Gas Weighted)
Last 7 Days:
188.0 HDD
+25.0 vs Normal
Next 7 Days:
215.0 HDD
+23.0 vs Normal
Cooling Degree Days (Population Weighted)
Last 7 Days:
0.0 CDD
+0.0 vs Normal
Next 7 Days:
0.0 CDD
+0.0 vs Normal
Weather Trend Analysis (Click charts to zoom)
HDD Analysis
CDD Analysis
×
![Zoomed Chart]()
Chart Analysis
Detailed Data
Recent HDD Data
| Date | HDD | Normal | Anomaly |
|---|---|---|---|
| 11/26 | 18.0 | 22.0 | -4.0 |
| 11/27 | 24.0 | 22.0 | +2.0 |
| 11/28 | 27.0 | 23.0 | +4.0 |
| 11/29 | 28.0 | 23.0 | +5.0 |
| 11/30 | 29.0 | 24.0 | +5.0 |
| 12/01 | 31.0 | 24.0 | +7.0 |
| 12/02 | 31.0 | 25.0 | +6.0 |
HDD Forecast
| Date | HDD | Normal | Anomaly |
|---|---|---|---|
| 12/04 | 34.0 | 26.0 | +8.0 |
| 12/05 | 34.0 | 27.0 | +7.0 |
| 12/06 | 29.0 | 27.0 | +2.0 |
| 12/07 | 30.0 | 28.0 | +2.0 |
| 12/08 | 33.0 | 28.0 | +5.0 |
| 12/09 | 30.0 | 28.0 | +2.0 |
| 12/10 | 25.0 | 28.0 | -3.0 |
Recent CDD Data
| Date | CDD | Normal | Anomaly |
|---|---|---|---|
| 11/26 | 0.0 | 0.0 | +0.0 |
| 11/27 | 0.0 | 0.0 | +0.0 |
| 11/28 | 0.0 | 0.0 | +0.0 |
| 11/29 | 0.0 | 0.0 | +0.0 |
| 11/30 | 0.0 | 0.0 | +0.0 |
| 12/01 | 0.0 | 0.0 | +0.0 |
| 12/02 | 0.0 | 0.0 | +0.0 |
CDD Forecast
| Date | CDD | Normal | Anomaly |
|---|---|---|---|
| 12/04 | 0.0 | 0.0 | +0.0 |
| 12/05 | 0.0 | 0.0 | +0.0 |
| 12/06 | 0.0 | 0.0 | +0.0 |
| 12/07 | 0.0 | 0.0 | +0.0 |
| 12/08 | 0.0 | 0.0 | +0.0 |
| 12/09 | 0.0 | 0.0 | +0.0 |
| 12/10 | 0.0 | 0.0 | +0.0 |
Data Source: NOAA Climate Prediction Center (CPC)
Region: CONUS
Climatology: 1981-2010 Normal Period
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:
Rising rates may impact energy demand
Risk Sentiment:
Low market volatility/risk appetite
Economic Indicators
USD_INDEX
99.0
Daily:
0.15 (0.15%)
Weekly:
-0.46 (-0.47%)
US_10Y
4.11
Daily:
0.05 (1.26%)
Weekly:
0.09 (2.27%)
SP500
6857.12
Daily:
7.4 (0.11%)
Weekly:
8.03 (0.12%)
VIX
15.78
Daily:
-0.3 (-1.87%)
Weekly:
-0.57 (-3.49%)
GOLD
4243.4
Daily:
44.1 (1.05%)
Weekly:
25.1 (0.6%)
COPPER
5.41
Daily:
0.11 (2.0%)
Weekly:
0.23 (4.41%)
CFTC Commitment of Traders Analysis
Natural Gas Positioning (NAT GAS NYME - NEW YORK MERCANTILE EXCHANGE)
Report Date: 2025-10-21
Sentiment: Bearish but Weakening
Positioning: Normal Range
Open Interest
1,682,048
Change: +7,879
Managed Money
-45,917
Change: +29,422
-2.7% of OI
Producer/Merchant
2,134
Change: +5,287
0.1% of OI
Swap Dealers
149,713
Change: +4,029
8.9% of OI
Other Reportables
-112,862
Change: -36,088
-6.7% of OI
Analysis Rationale (Managed Money):
- Managed Money sentiment: bearish but weakening
Crude Oil Positioning (WTI-PHYSICAL - NEW YORK MERCANTILE EXCHANGE)
Report Date: 2025-10-21
Sentiment: Bearish and Strengthening
Positioning: Normal Range
Open Interest
1,997,649
Change: -68,941
Managed Money
-38,154
Change: -19,388
-1.9% of OI
Producer/Merchant
309,536
Change: +14,091
15.5% of OI
Swap Dealers
-364,592
Change: +12,233
-18.3% of OI
Analysis Rationale (Managed Money):
- Managed Money sentiment: bearish and strengthening
LNG Market Analysis
LNG Market Summary
TTF prices increased to 9.649 EUR/MWh (+0.086). JKM prices decreased to 10.985 USD/MMBtu (-0.015). JKM is trading at a premium of 1.336 to TTF, indicating strong Asian demand.
TTF Prices
9.649
+0.086Front month: JAN 26
As of 2025-12-04
JKM Prices
10.985
-0.015Front month: JAN 26
As of 2025-12-04
JKM-TTF Spread
1.336
13.85%JKM is trading at a premium to TTF, indicating strong Asian demand.
As of 2025-12-04
Forward Curves Visualization
TTF (EUR/MWh)
JKM (USD/MMBtu)
11.2
10.6
10.1
9.6
9.1
TTF Forward Curve (Next 12 Months)
| Month | Price (EUR/MWh) |
|---|---|
| JAN 26 | 9.649 |
| FEB 26 | 9.695 |
| MAR 26 | 9.622 |
| APR 26 | 9.384 |
| MAY 26 | 9.294 |
| JUN 26 | 9.312 |
| JUL 26 | 9.338 |
| AUG 26 | 9.384 |
| SEP 26 | 9.483 |
| OCT 26 | 9.550 |
| NOV 26 | 9.717 |
| DEC 26 | 9.825 |
JKM Forward Curve (Next 12 Months)
| Month | Price (USD/MMBtu) |
|---|---|
| JAN 26 | 10.985 |
| FEB 26 | 10.380 |
| MAR 26 | 9.855 |
| APR 26 | 9.410 |
| MAY 26 | 9.340 |
| JUN 26 | 9.455 |
| JUL 26 | 9.635 |
| AUG 26 | 9.765 |
| SEP 26 | 9.750 |
| OCT 26 | 9.810 |
| NOV 26 | 9.830 |
| DEC 26 | 10.165 |
News & Sentiment Analysis
Market Sentiment Overview
BULLISH
Average Polarity:
0.433
Confidence:
1.0
Articles Analyzed:
85
Last Updated:
2025-12-04 23:47:03
Commodity Sentiment
HEATING_OIL
0.0
CRUDE_OIL
0.6
NATURAL_GAS
0.7
Top News Topics
Supply (7 articles)
- Higher Indian Sugar Production Weighs on Prices Barchart
- Oil rises on geopolitical risks to supply Reuters
- Oil Edges Higher Amid Supply Chain Disruption — Market Talk Dow Jones Newswires
- Unica Reports Larger Brazilian Sugar Output — Market Talk Dow Jones Newswires
- OPEC+'s Output Decision Likely Shaped By Geopolitical Risks — Market Talk Dow Jones Newswires
- OPEC+ Decision to Assess Maximum Output Capacity Could Spark Tensions — Market Talk Dow Jones Newswires
- Oil Climbs 2% on OPEC+ Steady Output Plan, Supply Risks — Market Talk Dow Jones Newswires
Demand (2 articles)
Geopolitical (8 articles)
- Geopolitical Tensions Underpin Crude Oil Prices Barchart
- Crude Oil Prices Find Support from a Weaker Dollar and Geopolitical Risks Barchart
- Crude Oil Prices Gain on Dollar Weakness and Geopolitical Risks Barchart
- Possible Easing of Geopolitical Risks Weighs on Crude Prices Barchart
- Geopolitical Tensions Unlikely to Change Long-Term Outlook for Oil Prices — Market Talk Dow Jones Newswires
- Oil rises on geopolitical risks to supply Reuters
- Geopolitical Turmoil Supports Crude Oil — Market Talk Dow Jones Newswires
- OPEC+'s Output Decision Likely Shaped By Geopolitical Risks — Market Talk Dow Jones Newswires
Weather (1 articles)
Fibonacci Levels Analysis
Current Price:
$5.08
Closest Support:
$4.6
9.45% below current price
Closest Resistance:
$5.1
0.39% above current price
Fibonacci Retracement Levels
0.0
$2.77
0.236
$3.32
0.382
$3.66
0.5
$3.94
0.618
$4.21
0.786
$4.6
Support
1.0
$5.1
Resistance
Fibonacci Extension Levels
1.272
$5.74
1.618
$6.55
2.0
$7.44
2.618
$8.88
ML Price Prediction
Current Price:
$5.06
Forecast Generated:
2025-12-04 23:47:04
Next Trading Day:
DOWN 0.5%
| Date | Prediction | Lower Bound | Upper Bound |
|---|---|---|---|
| 2025-12-05 | $5.04 | $4.73 | $5.34 |
| 2025-12-06 | $5.04 | $4.74 | $5.35 |
| 2025-12-07 | $5.05 | $4.75 | $5.35 |
| 2025-12-08 | $5.04 | $4.74 | $5.34 |
| 2025-12-09 | $5.04 | $4.73 | $5.34 |
ML Insights
- Forecast generated using ARIMA(5, 1, 0).
- The model predicts a price decrease of ~0.50% for the next trading day (2025-12-05), reaching $5.04.
- The 5-day forecast suggests relatively stable prices between 2025-12-05 and 2025-12-09.
- The average confidence interval width is ~12.0% of the predicted price, indicating model uncertainty.
- SIGNAL: Weak bearish signal, high uncertainty.
AI Analysis
For Energy Traders:
The current market sentiment is bullish with an overall sentiment score of +0.433. However, the technical interpretation is neutral (Score: 1/5), indicating potential indecision in the market. The Fibonacci support level is at 4.6 and resistance at 5.1, suggesting traders should watch these levels closely for potential breakouts or reversals.
The ML price forecast indicates a slight dip of 0.50% with a range of 4.73 to 5.34. This presents a short-term opportunity to capitalize on price fluctuations around these technical levels.
For Producers (Oil & Gas Companies):
The fundamental balance shows a decrease of -34.03 BCFD (Change: -25.13) with a ratio of 0.772, indicating tighter supply conditions which could impact production strategies. The bullish sentiment around crude oil, particularly with a score of +0.600, suggests favorable conditions for pricing, but producers should be cautious of geopolitical risks reflected in a negative sentiment score of -0.456.
It may be prudent to consider hedging strategies against potential volatility in demand, especially with forecasts indicating high heating demand across regions.
For Consumers (Industrial/Utilities):
With overall market sentiment remaining positive, consumers can expect some stability in pricing. However, the low cooling demand forecast alongside high heating demand suggests potential cost fluctuations, especially in the Northeast and Midwest regions where heating degree days (HDD) are significantly higher.
The weather outlook indicates a demand shift towards heating, which could affect supply reliability. Consumers should consider procurement strategies that account for these seasonal shifts and potential price increases.
For Commodity Professionals (Analysts, Consultants):
The convergence of a bullish sentiment in crude oil and a neutral technical outlook presents a complex market picture. Key driving factors include geopolitical tensions affecting supply and a significant focus on heating demand due to weather forecasts.
The overall sentiment score of +0.433, coupled with a fundamental balance showing tighter supply, suggests a cautious but optimistic outlook for the near term. Analysts should monitor the interplay between supply chain disruptions and demand fluctuations closely.
Disclaimer: This analysis is for informational purposes only and should not be considered as financial advice or specific buy/sell recommendations.