Natural gas prices consolidated and moved slightly lower, as traders seem to ignore the tropical cyclone that has formed in the Gulf. The barometric pressure is already close to 1K which could mean this will be a big storm. The weather is expected to be mild, cooler than normal on the East coast, and warmer than normal on the West coast. There is a storm in the Gulf of Mexico which the National Oceanic Atmospheric Administration has labeled a tropical cyclone that has winds of 45-miles an hour. U.S. natural gas rig count rose by one to 97 from 96, according to Baker Hughes. The estimate was for a 2-rig count increase.
Natural gas prices moved slightly lower Friday but closed above the 10-day moving average at 3.21. Resistance is seen near the June highs at 3.37. Short-term momentum is negative as the fast stochastic generated a crossover sell signal and moved from overbought to neutral. Medium-term momentum is turning negative as the MACD (moving average convergence divergence) histogram print in the black with a declining trajectory and points to a crossover sell signal.
Rigs are Rising
In August 2020, the United States rig count fell to 244, the lowest level since at least 1987, according to data from Baker Hughes Company. However, as of June 8, the reported total number of active rigs in the United States had risen to 461, and 96 of those active rigs were directed at drilling for natural gas.