Natural gas is currently in a sideways to downtrend. The October contract is being supported by Hurricane Harvey in the gulf, and all of the natural gas hubs are concerned with weather. Another named storm is headed toward the US off of Africa’s west coast. The gas storage number came in at a slightly lower build at 30 bcf. 33 bcf was expected by the trade. Last week’s build was 43 bcf.
Resistance is seen near $3.02 and above around $3.054. Close in support is at 2.90, then below about $2.80. A close above $3.00 could spark rallies to $3.10 and possibly above. Below $2.80 can technically clear the way for sell offs to lows that haven’t been seen since January of 2016.
There has been a drop in demand and consumption because the storm has cut power to hundreds of thousands of people. When the power comes back online we should see a significant jump in price. Weather is forecasted at normal to below average temperatures for the next 6-10 day period, which should offset some of demand increase from the restoration of the electric. Until Harvey moves out of the gulf, the sidelines maybe the safest place. Iron Condors and strangles might be just the thing in a non trending market.
Oct ’17 Natural Gas Daily Chart