Natural gas tells a similar story. Despite recent volatility, production remains near 110 Bcf/d, storage is projected to run ~200 Bcf looser than the five-year average, and European gas prices are down nearly 45% year-over-year, signaling global abundance. This week is about reconciling price behavior with balance-sheet reality and understanding which forces actually have the mass to move markets. This winter has been the story of strong forecasts and the market trades up, then real weather comes in falling short of the strong forecasts while traders forget and look at the next forecast. Well, as everything works in natural gas - it works until it doesn’t…after the turn of the year traders brought the previous level of 5.50 down to the reasonable level of 3.449. While I felt 4.50+ was too high, I feel like 3.449 is too low and a retracement to 3.75 is closer to fundamental parity. For now, I am watching the gap fill to 3.599 and likely return to 3.67 while waiting on forecasts.
ER
Natural Gas Radar
2026-01-07 23:48
Table of Contents
Brian's Thoughts
Today's Update
Natural gas is experiencing a rollercoaster ride, currently hovering around 3.449, which some traders argue is too low given that production remains steady at 110 Bcf/d and storage is projected to be 200 Bcf above the five-year average. Weather forecasts have been a mixed bag—strong projections initially sent prices up, but reality has shown less demand, causing fluctuations. With winter forecasts turning colder, there's potential for a rebound, but traders should watch for price movements around the 3.599 gap and the key level of 3.75 for fundamental parity.
Executive Summary
Total supply increased by 0.7 BCFD | Total demand increased by 16.0 BCFD | Market is undersupplied by 22.82 BCFD
Technical Analysis
Overall Technical Score (-5 to +5):
-1
(Neutral)
Current Price:
$3.61
Signal:
Neutral
Moving Averages (9/20)
BEARISH
MA(9): $3.9
MA(20): $4.04
Current Price is 3.61, 9 day MA 3.9, 20 day MA 4.04
MACD (12, 26, 9)
BEARISH
MACD: -0.2049
Signal: -0.1184
Days since crossover: 6
MACD crossed the line 6 days ago and is in a bearish setup
RSI (14)
NEUTRAL
Value: 41.15
Category: NEUTRAL
RSI is 41.15 (note 70% is overbought and 30% is oversold)
Volume (vs 20d Avg)
LOWER
Current: 3,640
Avg (20d): 156,079
Ratio: 0.02
Volume is lower versus 20 day average
Stochastic (14, 3)
BULLISH CROSS
%K: 20.76
%D: 11.64
Stochastic %K: 20.76, %D: 11.64. Signal: bullish cross
ADX (14)
WEAK TREND
ADX: 20.68
+DI: 22.51
-DI: 28.4
ADX: 20.68 (+DI: 22.51, -DI: 28.4). Trend: weak trend
Williams %R (14)
NEUTRAL
Value: -79.24
Williams %R: -79.24 (neutral zone)
Bollinger Bands (20, 2)
BELOW MIDDLE
Upper: 4.76
Middle: 4.04
Lower: 3.31
Price vs BBands (20, 2): below middle. Upper: 4.76, Middle: 4.04, Lower: 3.31
Fundamental Analysis
| Category | Current (BCFD) | Last Week | Last Year | 3 Yr Avg |
|---|---|---|---|---|
| Dry Production | 109.9 | 109.7 | 104.0 | 103.07 |
| LNG Imports | 0.0 | 0.0 | 0.0 | 0.07 |
| Canadian Imports | 6.0 | 5.5 | 6.8 | 6.13 |
| Total Supply | 115.9 | 115.2 | 110.8 | 109.23 |
| Industrial Demand | 23.6 | 21.3 | 25.4 | 25.3 |
| Electric Power Demand | 34.7 | 32.9 | 35.2 | 34.07 |
| Residential & Commercial | 47.0 | 35.1 | 38.9 | 40.97 |
| LNG Exports | 18.8 | 18.3 | 14.8 | 14.03 |
| Mexico Exports | 5.8 | 6.3 | 6.2 | 5.93 |
| Pipeline Fuel | 8.83 | 8.83 | 7.8 | 7.83 |
| Total Demand | 138.72 | 122.72 | 128.3 | 128.17 |
| Supply/Demand Balance | -22.82 | -7.52 | -17.5 | -18.93 |
Weather Analysis
Natural Gas Weather Impact:
HIGH heating demand - significant cold spell
(Heating-dominated conditions driving natural gas demand)
Weather Analysis Summary
Heating Degree Days (Utility Gas Weighted)
Last 7 Days:
148.0 HDD
-3.0 vs Normal
Next 7 Days:
159.0 HDD
-60.0 vs Normal
Cooling Degree Days (Population Weighted)
Last 7 Days:
0.0 CDD
+0.0 vs Normal
Next 7 Days:
3.0 CDD
+3.0 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 |
|---|---|---|---|
| 01/01 | 32.0 | 30.0 | +2.0 |
| 01/02 | 31.0 | 30.0 | +1.0 |
| 01/03 | 30.0 | 30.0 | +0.0 |
| 01/04 | 29.0 | 30.0 | -1.0 |
| 01/05 | 26.0 | 31.0 | -5.0 |
HDD Forecast
| Date | HDD | Normal | Anomaly |
|---|---|---|---|
| 01/07 | 20.0 | 31.0 | -11.0 |
| 01/08 | 20.0 | 32.0 | -12.0 |
| 01/09 | 19.0 | 31.0 | -12.0 |
| 01/10 | 21.0 | 32.0 | -11.0 |
| 01/11 | 27.0 | 32.0 | -5.0 |
| 01/12 | 27.0 | 31.0 | -4.0 |
| 01/13 | 25.0 | 30.0 | -5.0 |
Recent CDD Data
| Date | CDD | Normal | Anomaly |
|---|---|---|---|
| 01/01 | 0.0 | 0.0 | +0.0 |
| 01/02 | 0.0 | 0.0 | +0.0 |
| 01/03 | 0.0 | 0.0 | +0.0 |
| 01/04 | 0.0 | 0.0 | +0.0 |
| 01/05 | 0.0 | 0.0 | +0.0 |
CDD Forecast
| Date | CDD | Normal | Anomaly |
|---|---|---|---|
| 01/07 | 1.0 | 0.0 | +1.0 |
| 01/08 | 1.0 | 0.0 | +1.0 |
| 01/09 | 1.0 | 0.0 | +1.0 |
| 01/10 | 0.0 | 0.0 | +0.0 |
| 01/11 | 0.0 | 0.0 | +0.0 |
| 01/12 | 0.0 | 0.0 | +0.0 |
| 01/13 | 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:
Strong USD may pressure 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
98.72
Daily:
0.14 (0.14%)
Weekly:
0.44 (0.45%)
US_10Y
4.14
Daily:
-0.04 (-0.98%)
Weekly:
-0.03 (-0.6%)
SP500
6920.93
Daily:
-23.89 (-0.34%)
Weekly:
75.43 (1.1%)
VIX
15.38
Daily:
0.63 (4.27%)
Weekly:
0.43 (2.88%)
GOLD
4443.7
Daily:
-38.5 (-0.86%)
Weekly:
118.1 (2.73%)
COPPER
5.87
Daily:
-0.14 (-2.36%)
Weekly:
0.24 (4.24%)
CFTC Commitment of Traders Analysis
Natural Gas Positioning (NAT GAS NYME - NEW YORK MERCANTILE EXCHANGE)
Report Date: 2025-12-30
Sentiment: Bearish but Weakening
Positioning: Normal Range
Open Interest
1,533,985
Change: -23,664
Managed Money
-83,965
Change: +22,442
-5.5% of OI
Producer/Merchant
-5,306
Change: -4,767
-0.3% of OI
Swap Dealers
149,930
Change: +1,794
9.8% of OI
Other Reportables
-70,929
Change: -21,016
-4.6% of OI
Analysis Rationale (Managed Money):
- Managed Money sentiment: bearish but weakening
Crude Oil Positioning (WTI-PHYSICAL - NEW YORK MERCANTILE EXCHANGE)
Report Date: 2025-12-30
Sentiment: Bullish and Strengthening
Positioning: Normal Range
Open Interest
1,898,257
Change: +34,714
Managed Money
15,743
Change: +4,383
0.8% of OI
Producer/Merchant
235,605
Change: -9,543
12.4% of OI
Swap Dealers
-305,858
Change: +7,474
-16.1% of OI
Analysis Rationale (Managed Money):
- Managed Money sentiment: bullish and strengthening
LNG Market Analysis
LNG Market Summary
TTF prices increased to 9.634 EUR/MWh (+0.184). JKM prices increased to 9.575 USD/MMBtu (+0.035). JKM is trading at a discount of 0.059 to TTF, suggesting weaker Asian demand.
TTF Prices
9.634
+0.184Front month: FEB 26
As of 2026-01-07
JKM Prices
9.575
+0.035Front month: FEB 26
As of 2026-01-07
JKM-TTF Spread
-0.059
-0.61%JKM is trading at a discount to TTF, suggesting weaker Asian demand.
As of 2026-01-07
Forward Curves Visualization
TTF (EUR/MWh)
JKM (USD/MMBtu)
10.1
9.9
9.6
9.3
9.0
TTF Forward Curve (Next 12 Months)
| Month | Price (EUR/MWh) |
|---|---|
| FEB 26 | 9.634 |
| MAR 26 | 9.519 |
| APR 26 | 9.273 |
| MAY 26 | 9.127 |
| JUN 26 | 9.132 |
| JUL 26 | 9.158 |
| AUG 26 | 9.192 |
| SEP 26 | 9.289 |
| OCT 26 | 9.332 |
| NOV 26 | 9.461 |
| DEC 26 | 9.555 |
| JAN 27 | 9.636 |
JKM Forward Curve (Next 12 Months)
| Month | Price (USD/MMBtu) |
|---|---|
| FEB 26 | 9.575 |
| MAR 26 | 9.455 |
| APR 26 | 9.230 |
| MAY 26 | 9.125 |
| JUN 26 | 9.225 |
| JUL 26 | 9.405 |
| AUG 26 | 9.535 |
| SEP 26 | 9.490 |
| OCT 26 | 9.495 |
| NOV 26 | 9.530 |
| DEC 26 | 9.885 |
| JAN 27 | 10.050 |
News & Sentiment Analysis
Market Sentiment Overview
BEARISH
Average Polarity:
-0.367
Confidence:
1.0
Articles Analyzed:
92
Last Updated:
2026-01-07 23:47:49
Commodity Sentiment
NATURAL_GAS
-0.7
CRUDE_OIL
-0.4
HEATING_OIL
0.0
Top News Topics
Supply (11 articles)
- Crude Futures Fall After Trump Says Venezuela to Supply Oil to U.S. — Market Talk Dow Jones Newswires
- Canada Crude Can Compete With Increased Output From Venezuela, PM Carney Says — Market Talk Dow Jones Newswires
- Venezuela Needs Billions in Investment for Oil-Production Growth — Market Talk Dow Jones Newswires
- Crude Rallies as OPEC+ Keeps Output Levels Unchanged in Q1 Barchart
- Venezuelan Oil Output Increase A Longer-Term Prospect — Market Talk Dow Jones Newswires
- Venezuela Remains Contained Risk as Oil Market Focuses on Excess Supply — Market Talk Dow Jones Newswires
- Any Change to Venezuelan Oil Supply Less of a Driver for U.S. Treasurys — Market Talk Dow Jones Newswires
- Venezuela's Oil Won't Add Much to Rising Supply — Market Talk Dow Jones Newswires
- Oil Declines on Oversupply Worries After Maduro's Ouster — Market Talk Dow Jones Newswires
- Long-Term Stability in Venezuela Could Meaningfully Increase Oil Supply — Market Talk Dow Jones Newswires
- Oil prices likely to move higher on Venezuelan turmoil, ample supply to cap gains Reuters
Demand (4 articles)
- Commodity Demand Helps Canada Reduce Reliance on Trade With U.S. — Market Talk Dow Jones Newswires
- Crude Prices Retreat on Dollar Strength and Energy Demand Concerns Barchart
- Crude Prices Slip on Dollar Strength and Energy Demand Concerns Barchart
- China's Venezuelan Crude Imports Outlook Clouded by Political Uncertainty — Market Talk Dow Jones Newswires
Infrastructure (2 articles)
Geopolitical (4 articles)
- Oil Edges Lower on Prospects for Relief of Venezuela-Related Sanctions — Market Talk Dow Jones Newswires
- Crude Rallies on Rising Geopolitical Risks Barchart
- Oil Risk Premium Could Rise on Geopolitical Fallout of Maduro Capture — Market Talk Dow Jones Newswires
- U.S. Military Action Not a Reflection of Fundamental Shift in Foreign Policy — Market Talk Dow Jones Newswires
Weather (6 articles)
- Nat-Gas Prices Surge as US Weather Forecasts Turn Colder Barchart
- Nat-Gas Prices Sink on Forecasts for Above-Normal US Temps Barchart
- U.S. Natural Gas Continues Weather-Driven Slide — Market Talk Dow Jones Newswires
- U.S. Natural Gas Extends Losses on Milder Weather Outlook — Market Talk Dow Jones Newswires
- U.S. Natural Gas Sinks on Warmer Weather Outlook — Market Talk Dow Jones Newswires
- Maduro's Ouster Doesn't Change Morningstar's Oil Price Forecasts — Market Talk Dow Jones Newswires
Fibonacci Levels Analysis
Current Price:
$3.61
Closest Support:
$3.51
2.77% below current price
Closest Resistance:
$3.89
7.76% above current price
Fibonacci Retracement Levels
0.0
$2.89
0.236
$3.51
Support
0.382
$3.89
Resistance
0.5
$4.19
0.618
$4.5
0.786
$4.94
1.0
$5.5
Fibonacci Extension Levels
1.272
$6.2
1.618
$7.1
2.0
$8.1
2.618
$9.71
ML Price Prediction
Current Price:
$3.53
Forecast Generated:
2026-01-07 23:47:50
Next Trading Day:
DOWN 0.72%
| Date | Prediction | Lower Bound | Upper Bound |
|---|---|---|---|
| 2026-01-08 | $3.5 | $3.03 | $3.97 |
| 2026-01-09 | $3.5 | $3.03 | $3.97 |
| 2026-01-10 | $3.5 | $3.03 | $3.98 |
| 2026-01-11 | $3.52 | $3.05 | $3.99 |
| 2026-01-12 | $3.51 | $3.03 | $3.98 |
ML Insights
- Forecast generated using ARIMA(5, 1, 0).
- The model predicts a price decrease of ~0.72% for the next trading day (2026-01-08), reaching $3.50.
- The 5-day forecast suggests relatively stable prices between 2026-01-08 and 2026-01-12.
- The average confidence interval width is ~26.9% of the predicted price, indicating model uncertainty.
- SIGNAL: Weak bearish signal, high uncertainty.
AI Analysis
For Energy Traders:
Current market conditions suggest a neutral outlook with a technical score of -1/5. Traders should pay attention to the Fibonacci support level at 3.51 and resistance at 3.89. The ML price forecast indicates a potential downward movement of 0.72%, with a trading range of 3.03 to 3.97. This suggests short-term volatility may be limited, but traders should remain cautious of potential price fluctuations due to the bearish news sentiment.
For Producers (Oil & Gas Companies):
The fundamental balance is currently at -22.82 BCFD, indicating a significant decrease in supply. This suggests that producers may need to reassess their production planning and consider hedging strategies to mitigate risks from potential price declines. The bearish market sentiment could impact operational decisions and investment strategies, especially with the current focus on heating demand across regions.
For Consumers (Industrial/Utilities):
With high heating demand expected due to the current weather outlook (HDD: 19.2), consumers should prepare for potential cost fluctuations in natural gas prices. The bearish sentiment in the market may suggest a temporary reprieve, but ongoing supply concerns could lead to supply reliability risks. It is advisable for consumers to consider procurement strategies that account for both current price trends and potential future volatility.
For Commodity Professionals (Analysts, Consultants):
The energy market is currently influenced by a convergence of factors leading to a bearish sentiment overall. The key drivers include a negative fundamental balance and a predominantly heating-driven weather outlook. Analysts should monitor these trends closely, as shifts in sentiment could impact future price movements and market dynamics, particularly with the ongoing geopolitical developments surrounding crude oil supply.
Disclaimer: This analysis is for informational purposes only and does not constitute financial advice or specific buy/sell recommendations.