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
2026-01-08 23:48
Table of Contents
Brian's Thoughts
Today's Update
Natural gas remains in a state of flux, with production hovering around 110 Bcf/d and storage levels projected to be significantly looser than the five-year average. Recent volatility saw prices dip despite inventory draws, as forecasts for above-average US temperatures tempered demand. After a peak of $5.50, the market recalibrated to around $3.449, which some argue may be too low, with a potential retracement to $3.75 on the horizon. Traders should watch for weather updates and storage data to gauge market direction.
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:
$3.4
Signal:
Neutral
Moving Averages (9/20)
BEARISH
MA(9): $3.79
MA(20): $3.97
Current Price is 3.4, 9 day MA 3.79, 20 day MA 3.97
MACD (12, 26, 9)
BEARISH
MACD: -0.2314
Signal: -0.1422
Days since crossover: 7
MACD crossed the line 7 days ago and is in a bearish setup
RSI (14)
NEUTRAL
Value: 37.37
Category: NEUTRAL
RSI is 37.37 (note 70% is overbought and 30% is oversold)
Volume (vs 20d Avg)
LOWER
Current: 3,907
Avg (20d): 151,214
Ratio: 0.03
Volume is lower versus 20 day average
Stochastic (14, 3)
OVERSOLD
%K: 5.73
%D: 7.33
Stochastic %K: 5.73, %D: 7.33. Signal: oversold
ADX (14)
WEAK TREND
ADX: 20.3
+DI: 21.31
-DI: 28.28
ADX: 20.3 (+DI: 21.31, -DI: 28.28). Trend: weak trend
Williams %R (14)
OVERSOLD
Value: -94.27
Williams %R: -94.27 (oversold)
Bollinger Bands (20, 2)
BELOW MIDDLE
Upper: 4.72
Middle: 3.97
Lower: 3.23
Price vs BBands (20, 2): below middle. Upper: 4.72, Middle: 3.97, Lower: 3.23
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:
171.0 HDD
-11.0 vs Normal
Next 7 Days:
164.0 HDD
-55.0 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 |
| 01/06 | 23.0 | 31.0 | -8.0 |
HDD Forecast
| Date | HDD | Normal | Anomaly |
|---|---|---|---|
| 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 | 28.0 | 31.0 | -3.0 |
| 01/13 | 25.0 | 30.0 | -5.0 |
| 01/14 | 24.0 | 31.0 | -7.0 |
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 |
| 01/06 | 0.0 | 0.0 | +0.0 |
CDD Forecast
| Date | CDD | Normal | Anomaly |
|---|---|---|---|
| 01/08 | 1.0 | 0.0 | +1.0 |
| 01/09 | 1.0 | 0.0 | +1.0 |
| 01/10 | 1.0 | 0.0 | +1.0 |
| 01/11 | 0.0 | 0.0 | +0.0 |
| 01/12 | 0.0 | 0.0 | +0.0 |
| 01/13 | 0.0 | 0.0 | +0.0 |
| 01/14 | 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
NEUTRAL - Mixed economic signals
Dollar Impact:
Strong USD may pressure commodity prices
Industrial Demand:
Weaker industrial demand signals
Interest Rate Impact:
Stable/lower rates may support demand
Risk Sentiment:
Low market volatility/risk appetite
Economic Indicators
USD_INDEX
98.94
Daily:
0.26 (0.26%)
Weekly:
0.52 (0.53%)
US_10Y
4.18
Daily:
0.05 (1.09%)
Weekly:
-0.0 (-0.1%)
SP500
6921.46
Daily:
0.53 (0.01%)
Weekly:
62.99 (0.92%)
VIX
15.45
Daily:
0.07 (0.46%)
Weekly:
0.94 (6.48%)
GOLD
4470.4
Daily:
21.1 (0.47%)
Weekly:
156.0 (3.62%)
COPPER
5.82
Daily:
0.02 (0.27%)
Weekly:
0.18 (3.27%)
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 9.823 EUR/MWh (+0.189). JKM prices increased to 9.605 USD/MMBtu (+0.030). JKM is trading at a discount of 0.218 to TTF, suggesting weaker Asian demand.
TTF Prices
9.823
+0.189Front month: FEB 26
As of 2026-01-08
JKM Prices
9.605
+0.030Front month: FEB 26
As of 2026-01-08
JKM-TTF Spread
-0.218
-2.22%JKM is trading at a discount to TTF, suggesting weaker Asian demand.
As of 2026-01-08
Forward Curves Visualization
TTF (EUR/MWh)
JKM (USD/MMBtu)
10.1
9.8
9.6
9.3
9.0
TTF Forward Curve (Next 12 Months)
| Month | Price (EUR/MWh) |
|---|---|
| FEB 26 | 9.823 |
| MAR 26 | 9.718 |
| APR 26 | 9.399 |
| MAY 26 | 9.226 |
| JUN 26 | 9.221 |
| JUL 26 | 9.243 |
| AUG 26 | 9.281 |
| SEP 26 | 9.378 |
| OCT 26 | 9.408 |
| NOV 26 | 9.520 |
| DEC 26 | 9.623 |
| JAN 27 | 9.696 |
JKM Forward Curve (Next 12 Months)
| Month | Price (USD/MMBtu) |
|---|---|
| FEB 26 | 9.605 |
| MAR 26 | 9.545 |
| APR 26 | 9.250 |
| MAY 26 | 9.135 |
| JUN 26 | 9.230 |
| JUL 26 | 9.385 |
| AUG 26 | 9.525 |
| SEP 26 | 9.510 |
| OCT 26 | 9.485 |
| NOV 26 | 9.510 |
| DEC 26 | 9.880 |
| JAN 27 | 10.015 |
News & Sentiment Analysis
Market Sentiment Overview
BEARISH
Average Polarity:
-0.333
Confidence:
1.0
Articles Analyzed:
108
Last Updated:
2026-01-08 23:47:51
Commodity Sentiment
HEATING_OIL
0.0
CRUDE_OIL
-0.4
NATURAL_GAS
-0.6
Top News Topics
Supply (10 articles)
- Oil prices gain on concerns about supply disruptions in Venezuela, Iran Reuters
- U.S. Ethanol Output on Pace to Meet Corn Usage Target — Market Talk Dow Jones Newswires
- 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
Demand (7 articles)
- Crude Sharply Higher on Energy Demand Strength and Index Buying of Oil Futures Barchart
- Crude Rallies on Stronger Energy Demand and Index Buying of Crude Futures Barchart
- U.S. Ethanol Output on Pace to Meet Corn Usage Target — Market Talk Dow Jones Newswires
- 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 (5 articles)
- European defence stocks hit record high, dollar gains amid geopolitical events Reuters
- 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 (3 articles)
Fibonacci Levels Analysis
Current Price:
$3.4
Closest Support:
$2.89
15.0% below current price
Closest Resistance:
$3.51
3.24% above current price
Fibonacci Retracement Levels
0.0
$2.89
Support
0.236
$3.51
Resistance
0.382
$3.89
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:
$3.41
Forecast Generated:
2026-01-08 23:47:52
Next Trading Day:
UP 0.25%
| Date | Prediction | Lower Bound | Upper Bound |
|---|---|---|---|
| 2026-01-09 | $3.42 | $2.96 | $3.87 |
| 2026-01-10 | $3.42 | $2.96 | $3.88 |
| 2026-01-11 | $3.43 | $2.97 | $3.89 |
| 2026-01-12 | $3.41 | $2.96 | $3.87 |
| 2026-01-13 | $3.42 | $2.97 | $3.88 |
ML Insights
- Forecast generated using ARIMA(5, 1, 0).
- The model predicts a price increase of ~0.25% for the next trading day (2026-01-09), reaching $3.42.
- The 5-day forecast suggests relatively stable prices between 2026-01-09 and 2026-01-13.
- The average confidence interval width is ~26.7% of the predicted price, indicating model uncertainty.
- SIGNAL: Weak bullish signal, high uncertainty.
AI Analysis
For Energy Traders:
Current market conditions indicate a neutral sentiment with potential price direction showing a slight upward trend according to ML forecasts, predicting a movement of UP (0.25%) within the range of 2.96 to 3.87. Key Fibonacci support is at 2.89 and resistance at 3.51, suggesting that traders should monitor these levels closely for breakout opportunities.
Given the bearish overall market sentiment with a score of -0.333, volatility may increase, presenting both opportunities and risks. Traders should be cautious of any sudden shifts in sentiment or weather forecasts that could impact heating demand.
For Producers (Oil & Gas Companies):
The current fundamental balance shows a deficit of -22.82 BCFD, indicating a tightening supply which may affect operational planning. The bearish sentiment surrounding crude oil, especially with a score of -0.600, suggests a cautious approach to production levels.
Producers should consider hedging strategies to mitigate risks associated with fluctuating prices. The rise in heating demand across all regions, especially in the Northeast and Midwest, could provide opportunities for increased production, but careful monitoring of geopolitical developments is essential.
For Consumers (Industrial/Utilities):
With high heating demand expected due to the current weather outlook, consumers should prepare for potential cost fluctuations in energy procurement. The forecasted high heating demand (HDD: 25.6) indicates that energy costs may rise as supply tightens, especially given the fundamental balance deficit.
Additionally, the bearish sentiment in the market could impact supply reliability. Consumers should consider hedging against price increases to ensure stable energy costs during peak demand periods.
For Commodity Professionals (Analysts, Consultants):
The energy market is currently characterized by a bearish sentiment, with a sentiment score of -0.333 and a fundamental balance indicating a significant supply deficit of -22.82 BCFD. The weather forecast indicates a strong demand for heating, particularly in the Northeast and Midwest regions, which could further tighten supply.
Analysts should focus on the convergence of these factors, as the price is predicted to trend upward in the short term. The ML price forecast suggests potential volatility, necessitating close monitoring of geopolitical events and their implications on supply chains.
Disclaimer: This analysis is for informational purposes only and does not constitute financial advice or specific buy/sell recommendations.