Natural gas prices rallied for a second consecutive trading session rising nearly 2% after surging 11% on Monday. This came as no external weather factors were driving the price. The weather is expected to remain slightly below normal for the next 8-14 days. There are no tropical cyclones expected in the Atlantic Ocean or the Gulf of Mexico that could demand production infrastructure. The Chicago PMI manufacturing index came in softer than expected. LNG exports continue to decline weighing on demand.
AnalysisNatural gas prices continued to rebound on Tuesday rising 2% but unable to pierce through resistance from a downward sloping trend line that comes in near 1.76. Support is seen near the 10-day moving average at 1.68. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). Short term momentum also is positive as the fast stochastic generated a crossover buy signal and surged higher.
LNG Exports Decline
US LNG exports decrease week over week. Seven liquefied natural gas vessels with a combined LNG-carrying capacity of 25 Bcf departed the United States between June 18 and June 24, 2020, according to shipping data provided by the EIA.