Natural gas costs rebounded close to support levels after tumbling on Tuesday. Prices surged after a report from the National Oceanic Atmospheric Administration showed that the weather should be cooler than usual for the next 8-14 days. Chilly weather will float heating demand. There are at present no possibilities of a tropical cyclone in the Atlantic or Gulf throughout the next 48-hours, according to NOAA. Demand was down in the latest week, led by a massive drop in power generation.
Natural gas prices rebounded near support following a drop of 3% on Monday. Support is seen close to an upward sloping line that comes near 2.20. Rates are floating, and near resistance is seen near the 10-day moving average at 2.27. Further resistance is seen near the October highs at 2.38. Short interval momentum is turning positive on Tuesday after showing negative on Monday, which usually points to consolidation. Medium-term momentum is flat because the moving average convergence divergence (MACD) is moving sideways. The MACD histogram is marking near the zero-index level with a flat trajectory that points to concentration.
Demand is down in all industries, according to a report by the Energy Information Administration. The total U.S. consumption of natural gas dropped by 1% in contrast with the previous week. Natural gas consumed for power generation sank by 7% week over week. Industrial sector consumption reduced by 2% week over week. In the commercial and residential sectors, consumption rose by 22% as heating, and cooling demand was moderate with annual autumn temperatures. Natural gas exports to Mexico lowered by 3%.