Natural Gas Futures Approach 10-Month Low

Natural Gas Futures (NYMEX: NG) have faced persistent downward pressure, marking a stark contrast to their peak in 2022.  

Throughout 2023, the futures plummeted by 43.82%, with the trend continuing into 2024, currently down nearly 20% year-to-date. Despite forecasts predicting colder weather and heightened heating demand, prices have declined.  

Factors such as increasing output, reduced gas flow to export plants, and lower medium-term demand projections have contributed to this decline. Traders observe rising output as gas wells recover from freezing during mid-January’s extreme cold. The natural gas market’s dynamics underscore the interplay between supply, demand, and weather patterns, influencing commodity prices. 


The Natural Gas futures have been trapped in a downtrend, confined within a descending channel pattern below the 100-day moving average. Resistance emerged at the 2.884 MMBtu level, coinciding with overbought RSI conditions and precipitating a decline towards the 1.946 MMBtu support level established in April 2023. 

Recent trading activity has shown diminished volumes, resulting in a sideways consolidation within a rectangle pattern. A breakout from this pattern, accompanied by high volume, could signal a significant move in the breakout direction. 

If the price breaches below the pattern and the 1.946 MMBtu support level, attention may turn to the 1.795 MMBtu level as a potential downside target. Conversely, an upside breakout could lead to gains, potentially aligning with the 100-day moving average. 


Natural Gas futures are at a crossroads as they approach a 10-month low. With persistent downward pressure, key technical levels at 2.884 MMBtu resistance and 1.946 MMBtu support are crucial. Traders await a breakout from the sideways consolidation, reflecting market uncertainty amid supply-demand dynamics and weather influences. 

Sources: Reuters, TradingView 

Piece Written By Nkosilathi Dube, Trive Financial Market Analyst 

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