This week is projected to be the biggest draw EVER. There is currently over 350 BCF expected to be withdrawn from 1/23 to 1/30. Traders remember winter storm Yuri that brought physical prices over $400. This combined with a significant hedge fund short position shifted natural gas from $3 on the Feb Contract to over $5.30 on Friday’s close. Note that the March contract moved up significantly but at a much lower scale - only $1 (that’s sarcasm - it’s a lot but shows that most of this volatile move was on the Feb contract catching hedge funds short). Feb contract rolls off on the 28th - so Monday will be a volatile day as winter storm Fern will be settled in on demand impact. This is changing EOS storage to potentially below 1.6 TCF - that is low and will provide price support for 2026. Two weeks ago EOS was over 1.9 TCF so this is a shift. Production is down 10 BCFD+ fundamentally we are looking slightly bullish from last week - March contract is trading 3.83 (which is right at a key support/resistance level) and February is trading at over $6.50. This week will likely moderate the volatility and March will settle in somewhere between 3.449 and 3.87 with a likely bull/bear line at 3.679. Monday’s close ended up showing strength which firms up the sentiment that this is very bullish and may move March to have higher support. Projections are holding true that we will be above 350 BCF on the week ending Jan 30th for the withdrawal.
ER
Natural Gas Radar
2026-01-27 23:48
Table of Contents
Brian's Thoughts
Today's Update
Natural Gas is experiencing extreme volatility due to a historic draw of over 350 BCF expected this week, driven by severe winter weather, with futures surging from $3 to over $5.30. The February contract, influenced by hedge fund short positions, sees significant movement as it approaches expiration. While production dips above 10 BCFD and storage forecasts drop below 1.6 TCF, the market sentiment remains bullish. As we watch for Monday's settling, expect potential price support around key resistance levels, particularly in March trading.
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:
$3.75
Signal:
Neutral
Moving Averages (9/20)
BULLISH
MA(9): $4.33
MA(20): $3.94
Current Price is 3.75, 9 day MA 4.33, 20 day MA 3.94
MACD (12, 26, 9)
BULLISH
MACD: 0.232
Signal: 0.0227
Days since crossover: 6
MACD crossed the line 6 days ago and is in a bullish setup
RSI (14)
NEUTRAL
Value: 46.96
Category: NEUTRAL
RSI is 46.96 (note 70% is overbought and 30% is oversold)
Volume (vs 20d Avg)
LOWER
Current: 4,722
Avg (20d): 193,925
Ratio: 0.02
Volume is lower versus 20 day average
Stochastic (14, 3)
BEARISH CROSS
%K: 16.69
%D: 62.7
Stochastic %K: 16.69, %D: 62.7. Signal: bearish cross
ADX (14)
STRONG UPTREND
ADX: 28.56
+DI: 38.34
-DI: 26.76
ADX: 28.56 (+DI: 38.34, -DI: 26.76). Trend: strong uptrend
Williams %R (14)
OVERSOLD
Value: -83.31
Williams %R: -83.31 (oversold)
Bollinger Bands (20, 2)
BELOW MIDDLE
Upper: 5.78
Middle: 3.94
Lower: 2.1
Price vs BBands (20, 2): below middle. Upper: 5.78, Middle: 3.94, Lower: 2.1
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 (ABOVE normal heating demand)
(Heating-dominated conditions driving natural gas demand)
Weather Analysis Summary
Heating Degree Days (Utility Gas Weighted)
Last 7 Days:
268.0 HDD
+44.0 vs Normal
Next 7 Days:
281.0 HDD
+65.0 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 |
|---|---|---|---|
| 01/19 | 36.0 | 33.0 | +3.0 |
| 01/20 | 37.0 | 33.0 | +4.0 |
| 01/21 | 34.0 | 33.0 | +1.0 |
| 01/22 | 32.0 | 32.0 | +0.0 |
| 01/23 | 38.0 | 31.0 | +7.0 |
| 01/24 | 46.0 | 31.0 | +15.0 |
| 01/25 | 45.0 | 31.0 | +14.0 |
HDD Forecast
| Date | HDD | Normal | Anomaly |
|---|---|---|---|
| 01/27 | 42.0 | 32.0 | +10.0 |
| 01/28 | 41.0 | 31.0 | +10.0 |
| 01/29 | 41.0 | 31.0 | +10.0 |
| 01/30 | 43.0 | 31.0 | +12.0 |
| 01/31 | 42.0 | 31.0 | +11.0 |
| 02/01 | 38.0 | 30.0 | +8.0 |
| 02/02 | 34.0 | 30.0 | +4.0 |
Recent CDD Data
| Date | CDD | Normal | Anomaly |
|---|---|---|---|
| 01/19 | 0.0 | 0.0 | +0.0 |
| 01/20 | 0.0 | 0.0 | +0.0 |
| 01/21 | 0.0 | 0.0 | +0.0 |
| 01/22 | 0.0 | 0.0 | +0.0 |
| 01/23 | 0.0 | 0.0 | +0.0 |
| 01/24 | 0.0 | 0.0 | +0.0 |
| 01/25 | 0.0 | 0.0 | +0.0 |
CDD Forecast
| Date | CDD | Normal | Anomaly |
|---|---|---|---|
| 01/27 | 0.0 | 0.0 | +0.0 |
| 01/28 | 0.0 | 0.0 | +0.0 |
| 01/29 | 0.0 | 0.0 | +0.0 |
| 01/30 | 0.0 | 0.0 | +0.0 |
| 01/31 | 0.0 | 0.0 | +0.0 |
| 02/01 | 0.0 | 0.0 | +0.0 |
| 02/02 | 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:
Stable/lower rates may support demand
Risk Sentiment:
Low market volatility/risk appetite
Economic Indicators
USD_INDEX
96.12
Daily:
-0.92 (-0.94%)
Weekly:
-2.64 (-2.67%)
US_10Y
4.22
Daily:
0.01 (0.24%)
Weekly:
-0.03 (-0.71%)
SP500
6978.6
Daily:
28.37 (0.41%)
Weekly:
102.98 (1.5%)
VIX
16.35
Daily:
0.2 (1.24%)
Weekly:
-0.55 (-3.25%)
GOLD
5230.8
Daily:
151.1 (2.97%)
Weekly:
399.0 (8.26%)
COPPER
5.98
Daily:
-0.01 (-0.08%)
Weekly:
0.25 (4.35%)
CFTC Commitment of Traders Analysis
Natural Gas Positioning (NAT GAS NYME - NEW YORK MERCANTILE EXCHANGE)
Report Date: 2026-01-20
Sentiment: Bearish but Weakening
Positioning: Normal Range
Open Interest
1,614,025
Change: -21,195
Managed Money
-77,101
Change: +28,033
-4.8% of OI
Producer/Merchant
17,432
Change: +9,100
1.1% of OI
Swap Dealers
164,628
Change: +116
10.2% of OI
Other Reportables
-116,389
Change: -35,922
-7.2% of OI
Analysis Rationale (Managed Money):
- Managed Money sentiment: bearish but weakening
Crude Oil Positioning (WTI-PHYSICAL - NEW YORK MERCANTILE EXCHANGE)
Report Date: 2026-01-20
Sentiment: Bullish but Weakening
Positioning: Normal Range
Open Interest
1,964,359
Change: -54,430
Managed Money
47,500
Change: -70
2.4% of OI
Producer/Merchant
204,437
Change: -25,404
10.4% of OI
Swap Dealers
-301,484
Change: -6,193
-15.3% of OI
Analysis Rationale (Managed Money):
- Managed Money sentiment: bullish but weakening
LNG Market Analysis
LNG Market Summary
TTF prices decreased to 11.560 EUR/MWh (-0.030). JKM prices decreased to 11.225 USD/MMBtu (-0.060). JKM is trading at a discount of 0.335 to TTF, suggesting weaker Asian demand.
TTF Prices
11.560
-0.030Front month: FEB 26
As of 2026-01-27
JKM Prices
11.225
-0.060Front month: MAR 26
As of 2026-01-27
JKM-TTF Spread
-0.335
-2.90%JKM is trading at a discount to TTF, suggesting weaker Asian demand.
As of 2026-01-27
Forward Curves Visualization
TTF (EUR/MWh)
JKM (USD/MMBtu)
13.3
12.5
11.6
10.7
9.9
TTF Forward Curve (Next 12 Months)
| Month | Price (EUR/MWh) |
|---|---|
| FEB 26 | 11.560 |
| MAR 26 | 13.046 |
| APR 26 | 11.461 |
| MAY 26 | 10.448 |
| JUN 26 | 10.262 |
| JUL 26 | 10.221 |
| AUG 26 | 10.205 |
| SEP 26 | 10.311 |
| OCT 26 | 10.221 |
| NOV 26 | 10.240 |
| DEC 26 | 10.335 |
| JAN 27 | 10.413 |
JKM Forward Curve (Next 12 Months)
| Month | Price (USD/MMBtu) |
|---|---|
| MAR 26 | 11.225 |
| APR 26 | 10.925 |
| MAY 26 | 10.340 |
| JUN 26 | 10.285 |
| JUL 26 | 10.335 |
| AUG 26 | 10.370 |
| SEP 26 | 10.330 |
| OCT 26 | 10.195 |
| NOV 26 | 10.170 |
| DEC 26 | 10.450 |
| JAN 27 | 10.540 |
| FEB 27 | 10.460 |
News & Sentiment Analysis
Market Sentiment Overview
BULLISH
Average Polarity:
0.225
Confidence:
1.0
Articles Analyzed:
56
Last Updated:
2026-01-27 23:47:53
Commodity Sentiment
NATURAL_GAS
0.75
CRUDE_OIL
-0.3
Top News Topics
Supply (7 articles)
- Arctic Blast Curbs US Nat-Gas Production and Boosts Prices Barchart
- US natgas futures soar 89% over five days as freezing wells cut output to two-year low Reuters
- WTI Rebounds as US Winter Storm Cuts Oil Output Trading Economics
- Oil Falls, With Focus on Supply, U.S. Winter Storm Impact — Market Talk Dow Jones Newswires
- Oil futures surge 3% a barrel as winter storm slams US output Reuters
- Oil slips even as US winter storm curbs crude output Reuters
- Oil prices settle lower as traders assess impact of winter storm on production Reuters
Demand (1 articles)
Geopolitical (2 articles)
- Oil Futures Rise On Geopolitical Apprehension — Market Talk Dow Jones Newswires
- Oil Ticks Up Amid Geopolitical Risks Trading Economics
Weather (11 articles)
- US Natgas Prices Ease on Warmer Forecasts Trading Economics
- U.S. Natural Gas Futures Ease, But Frigid Weather Persists — Market Talk Dow Jones Newswires
- U.S. Natural Gas Extends Rally on Winter Storm — Market Talk Dow Jones Newswires
- Winter Storm Lifts Near-Term U.S. Natural Gas — Market Talk Dow Jones Newswires
- U.S. Natural Gas Extends Gains on Winter Storm — Market Talk Dow Jones Newswires
- WTI Rebounds as US Winter Storm Cuts Oil Output Trading Economics
- Oil Falls, With Focus on Supply, U.S. Winter Storm Impact — Market Talk Dow Jones Newswires
- Oil futures surge 3% a barrel as winter storm slams US output Reuters
- Oil slips even as US winter storm curbs crude output Reuters
- Storm-Driven Diesel Futures Offer Crude Some Support — Market Talk Dow Jones Newswires
- Oil prices settle lower as traders assess impact of winter storm on production Reuters
Fibonacci Levels Analysis
Current Price:
$3.75
Closest Support:
$3.01
19.73% below current price
Closest Resistance:
$4.05
8.0% above current price
Fibonacci Retracement Levels
0.0
$3.01
Support
0.236
$4.05
Resistance
0.382
$4.7
0.5
$5.22
0.618
$5.75
0.786
$6.49
1.0
$7.44
Fibonacci Extension Levels
1.272
$8.64
1.618
$10.18
2.0
$11.87
2.618
$14.61
ML Price Prediction
Current Price:
$6.95
Forecast Generated:
2026-01-27 23:47:53
Next Trading Day:
UP 1.26%
| Date | Prediction | Lower Bound | Upper Bound |
|---|---|---|---|
| 2026-01-28 | $7.04 | $6.21 | $7.87 |
| 2026-01-29 | $7.36 | $6.53 | $8.18 |
| 2026-01-30 | $7.58 | $6.75 | $8.41 |
| 2026-01-31 | $7.52 | $6.69 | $8.35 |
| 2026-02-01 | $7.59 | $6.76 | $8.42 |
ML Insights
- Forecast generated using ARIMA(5, 1, 0).
- The model predicts a price increase of ~1.26% for the next trading day (2026-01-28), reaching $7.04.
- The 5-day forecast suggests a generally upward trend, moving about 7.8% between 2026-01-28 and 2026-02-01.
- The average confidence interval width is ~22.4% of the predicted price, indicating model uncertainty.
- SIGNAL: Weak bullish signal, high uncertainty.
AI Analysis
For Energy Traders:
Current market indicators suggest a neutral sentiment, with a technical score of 1/5. The Fibonacci support level is at 3.01, while resistance is at 4.05. Traders should be cautious as the fundamental balance is currently at -22.82 BCFD with a significant change of -15.30, indicating potential volatility. The ML price forecast suggests a short-term increase of 1.26%, with a predicted range between 6.21 and 7.87. Monitor the weather outlook, particularly the strong heating demand indicated by high Heating Degree Days (HDD), which could influence price dynamics.
For Producers (Oil & Gas Companies):
With a bearish sentiment in the supply sector, as indicated by a sentiment score of -0.100, producers should adjust their production planning accordingly. The fundamental balance indicates a significant reduction in demand, which may require strategic adjustments in output. The current weather outlook suggests high heating demand, particularly in the Northeast and Midwest, which might provide an opportunity to optimize production for natural gas. Consider hedging strategies in response to the ML forecast indicating potential price increases in the short term.
For Consumers (Industrial/Utilities):
Consumers should prepare for potential cost fluctuations as the market sentiment remains bullish overall, with heating demand expected to peak due to the current weather conditions. The high heating demand forecast indicates a need for reliable supply, particularly in regions with high HDD. Given the recent fundamental balance of -22.82 BCFD, procurement strategies may need to be reevaluated to mitigate risks associated with supply reliability. It is advisable to consider short-term hedging options to manage potential price spikes.
For Commodity Professionals (Analysts, Consultants):
The current market landscape shows a bullish sentiment overall, driven by strong heating demand and a significant fundamental balance deficit. The technical indicators are neutral, with support at 3.01 and resistance at 4.05. The weather outlook favors heating over cooling, particularly in the Northeast, which could lead to increased demand for natural gas. Analysts should closely monitor the ML price forecast and news sentiment, particularly regarding supply disruptions due to weather conditions, as these will be critical in shaping market trends moving forward.
Disclaimer: This analysis is for informational purposes only and does not constitute financial advice or specific buy/sell recommendations.