Natural gas prices are finding mild support this morning, but they remain near the bottom end of yesterday’s range.  August natural gas traded to a low of 2.832 yesterday, which was the lowest it has been since November 9. A very weak crude oil market pulled prices lower, as did forecasts for normal temps in the eastern third of the US through July 19.  The early estimates for the inventory report on Friday call for an increase of 59 bcf last week versus the 5-year average increase of 66 bcf. Stockpiles totaled 2,816 bcf as of June 23, 6.9% above the five year average. August natural gas made lower lows for four sessions in a row, and yesterday it took out the June low of 2.875. With managed money category adding 25,824 contracts of speculative length to a total long position on 80,966 contracts as of June 27, some further liquidation may be seen. A trade below the November low of 2.815 leaves the May 2016 low of 2.772 as the next level of support and below that a swing objective of 2.722.

 

Aug ’17 Natural Gas Daily Chart