Natural Gas Radar

2025-10-05 23:48

Table of Contents

Brian's Thoughts

Published: 10/05/2025 Focus: Natural Gas
So we laid out 3.449 as the gap fill on Monday as a possibility, Tuesday after the break above 3.247 identified a high likelihood of the 3.449 gap fill, and Wednesday we reached the target - wow that was pretty quick! Now I am looking at two levels: 3.599 as the next target and 3.247 as the downside target if 3.50 is not held…after reaching the gap fill - the stall out could be a sign of exhaustion after the short covering rally (at least that’s what folks are saying - we won’t know for sure until the COT report comes out). Fundamentally - 3.247 and higher is validated by the current supply/demand and while I am still sitting at 3.8 TCF storage there are some analysts that I respect that are calling for 4.0 TCF which would give credence to another move down below $3 again. For now - I think we are in a large range of 3.247 to 3.5999

Today's Update

Updated: 2025-10-05 23:47:02 Length: 480 chars
Natural gas prices have recently faced pressure due to mild mid-October temperatures, which have resulted in low demand amid high supply levels. After reaching the gap fill at 3.449, the market is now navigating between 3.247 and 3.599, with 3.247 acting as a key downside target. If the upper threshold is not maintained, analysts suggest a potential dip below $3, especially with storage levels hovering around 3.8 TCF. Watch for the COT report for further insights into mark...

Executive Summary

Total supply decreased by 0.9 BCFD | Total demand decreased by 1.4 BCFD | Market is oversupplied by 10.9 BCFD

Technical Analysis

Overall Technical Score (-5 to +5): 1 (Neutral)
Current Price: $3.41
Signal: Neutral

Moving Averages (9/20)

BULLISH

MA(9): $3.2

MA(20): $3.08

Current Price is 3.41, 9 day MA 3.2, 20 day MA 3.08

MACD (12, 26, 9)

BULLISH

MACD: 0.1019

Signal: 0.047

Days since crossover: 6

MACD crossed the line 6 days ago and is in a bullish setup

RSI (14)

NEUTRAL

Value: 63.59

Category: NEUTRAL

RSI is 63.59 (note 70% is overbought and 30% is oversold)

Volume (vs 20d Avg)

LOWER

Current: 9,333

Avg (20d): 155,860

Ratio: 0.06

Volume is lower versus 20 day average

Stochastic (14, 3)

BULLISH CROSS

%K: 78.47

%D: 76.26

Stochastic %K: 78.47, %D: 76.26. Signal: bullish cross

ADX (14)

WEAK TREND

ADX: 20.36

+DI: 31.93

-DI: 17.72

ADX: 20.36 (+DI: 31.93, -DI: 17.72). Trend: weak trend

Williams %R (14)

NEUTRAL

Value: -21.53

Williams %R: -21.53 (neutral zone)

Bollinger Bands (20, 2)

ABOVE MIDDLE

Upper: 3.51

Middle: 3.08

Lower: 2.65

Price vs BBands (20, 2): above middle. Upper: 3.51, Middle: 3.08, Lower: 2.65

Fundamental Analysis

Category Current (BCFD) Last Week Last Year 3 Yr Avg
Dry Production 105.8 106.7 101.2 100.53
LNG Imports 0.0 0.0 0.1 0.1
Canadian Imports 5.0 5.0 5.9 5.6
Total Supply 110.8 111.7 107.2 106.23
Industrial Demand 22.0 22.1 21.8 21.83
Electric Power Demand 37.0 40.0 40.3 36.5
Residential & Commercial 11.5 8.8 8.9 10.13
LNG Exports 15.8 16.3 12.6 12.0
Mexico Exports 6.8 7.2 7.0 6.37
Pipeline Fuel 6.8 6.8 6.6 6.67
Total Demand 99.9 101.3 97.2 93.53
Supply/Demand Balance 10.9 10.4 10.0 12.7

Weather Analysis

Weather Impact Summary

Overall: COOLING dominated (HDD: 2.1, CDD: 4.7)
Residential/Commercial: LOW heating demand expected
Power Generation: LOW cooling demand expected

Regional Weather Patterns

Northeast

Heating dominated (HDD: 5.2)

Midwest

Cooling dominated (CDD: 1.5)

South

Cooling dominated (CDD: 7.5)

West

Cooling dominated (CDD: 14.5)

Degree Days by City

Chicago, IL

Heating Degree Days (HDD): 0.0
Cooling Degree Days (CDD): 1.5
Total HDD: 18.0
Total CDD: 14.0

New York, NY

Heating Degree Days (HDD): 5.5
Cooling Degree Days (CDD): 0.0
Total HDD: 24.0
Total CDD: 21.0

Houston, TX

Heating Degree Days (HDD): 0
Cooling Degree Days (CDD): 7.5
Total HDD: 0
Total CDD: 152.5

Los Angeles, CA

Heating Degree Days (HDD): 0
Cooling Degree Days (CDD): 14.5
Total HDD: 0
Total CDD: 130.5

Philadelphia, PA

Heating Degree Days (HDD): 5.0
Cooling Degree Days (CDD): 0.0
Total HDD: 20.5
Total CDD: 16.5

Economic Analysis

Economic Sentiment Summary

POSITIVE - Economic indicators generally supportive
Dollar Impact: Strong USD may pressure commodity prices
Industrial Demand: Strong industrial demand signals
Interest Rate Impact: Stable/lower rates may support demand
Risk Sentiment: Low market volatility/risk appetite

Economic Indicators

USD_INDEX

98.01
Daily: 0.29 (0.3%)
Weekly: 0.24 (0.25%)

US_10Y

4.12
Daily: 0.03 (0.76%)
Weekly: -0.02 (-0.53%)

SP500

6715.79
Daily: 0.44 (0.01%)
Weekly: 54.58 (0.82%)

VIX

16.65
Daily: 0.02 (0.12%)
Weekly: 0.53 (3.29%)

GOLD

3949.3
Daily: 68.5 (1.77%)
Weekly: 108.5 (2.82%)

COPPER

5.1
Daily: 0.04 (0.83%)
Weekly: 0.3 (6.14%)

CFTC Commitment of Traders Analysis

Natural Gas Positioning (NAT GAS NYME - NEW YORK MERCANTILE EXCHANGE)

Report Date: 2025-09-23
Sentiment: Bearish and Strengthening
Positioning: Normal Range

Open Interest

1,626,777
Change: -11,903

Managed Money

-63,176
Change: -40,085
-3.9% of OI

Producer/Merchant

-4,944
Change: +8,712
-0.3% of OI

Swap Dealers

124,686
Change: +6,611
7.7% of OI

Other Reportables

-64,908
Change: +22,945
-4.0% of OI

Analysis Rationale (Managed Money):

  • Managed Money sentiment: bearish and strengthening

Crude Oil Positioning (WTI-PHYSICAL - NEW YORK MERCANTILE EXCHANGE)

Report Date: 2025-09-23
Sentiment: Bullish but Weakening
Positioning: Normal Range

Open Interest

1,936,690
Change: -25,930

Managed Money

26,483
Change: -10,316
1.4% of OI

Producer/Merchant

283,712
Change: -9,029
14.6% of OI

Swap Dealers

-402,312
Change: +5,178
-20.8% of OI

Analysis Rationale (Managed Money):

  • Managed Money sentiment: bullish but weakening

LNG Market Analysis

LNG Market Summary

TTF prices increased to 10.815 EUR/MWh (+0.017). JKM prices increased to 11.040 USD/MMBtu (+0.015). JKM is trading at a premium of 0.225 to TTF, indicating strong Asian demand.

TTF Prices

10.815

+0.017

Front month: NOV 25

As of 2025-10-05

JKM Prices

11.040

+0.015

Front month: NOV 25

As of 2025-10-05

JKM-TTF Spread

0.225

2.08%

JKM is trading at a premium to TTF, indicating strong Asian demand.

As of 2025-10-05

Forward Curves Visualization
TTF (EUR/MWh)
JKM (USD/MMBtu)
11.2
11.0
10.8
10.6
10.4
10.81
11.04
NOV 25
10.99
10.96
DEC 25
11.10
11.18
JAN 26
11.12
11.15
FEB 26
10.99
10.88
MAR 26
10.64
10.51
APR 26
10.51
10.46
MAY 26
10.53
10.55
JUN 26
10.56
10.72
JUL 26
10.62
10.86
AUG 26
10.71
10.92
SEP 26
10.79
10.96
OCT 26
TTF Forward Curve (Next 12 Months)
Month Price (EUR/MWh)
NOV 25 10.815
DEC 25 10.992
JAN 26 11.095
FEB 26 11.122
MAR 26 10.992
APR 26 10.642
MAY 26 10.514
JUN 26 10.525
JUL 26 10.564
AUG 26 10.619
SEP 26 10.713
OCT 26 10.791
JKM Forward Curve (Next 12 Months)
Month Price (USD/MMBtu)
NOV 25 11.040
DEC 25 10.955
JAN 26 11.175
FEB 26 11.150
MAR 26 10.880
APR 26 10.505
MAY 26 10.455
JUN 26 10.555
JUL 26 10.725
AUG 26 10.855
SEP 26 10.920
OCT 26 10.965

News & Sentiment Analysis

Market Sentiment Overview

BEARISH
Average Polarity: -0.5
Confidence: 1.0
Articles Analyzed: 42
Last Updated: 2025-10-05 23:47:55

Commodity Sentiment

NATURAL_GAS

-0.4

CRUDE_OIL

-0.6

Top News Topics

Supply (9 articles)

Demand (2 articles)

Infrastructure (1 articles)

Geopolitical (1 articles)

Weather (1 articles)

Fibonacci Levels Analysis

Current Price: $3.41
Closest Support: $3.24 4.99% below current price
Closest Resistance: $3.41 0.0% above current price

Fibonacci Retracement Levels

0.0 $2.62
0.236 $2.86
0.382 $3.01
0.5 $3.13
0.618 $3.24 Support
0.786 $3.41 Current Price
1.0 $3.63

Fibonacci Extension Levels

1.272 $3.9
1.618 $4.25
2.0 $4.64
2.618 $5.26

ML Price Prediction

Current Price: $3.32
Forecast Generated: 2025-10-05 23:47:55
Next Trading Day: DOWN 0.6%
Date Prediction Lower Bound Upper Bound
2025-10-04 $3.3 $3.09 $3.52
2025-10-05 $3.3 $3.09 $3.52
2025-10-06 $3.28 $3.06 $3.49
2025-10-07 $3.28 $3.07 $3.5
2025-10-08 $3.29 $3.08 $3.51

ML Insights

  • Forecast generated using ARIMA(5, 1, 0).
  • The model predicts a price decrease of ~0.60% for the next trading day (2025-10-04), reaching $3.30.
  • The 5-day forecast suggests relatively stable prices between 2025-10-04 and 2025-10-08.
  • The average confidence interval width is ~13.1% of the predicted price, indicating model uncertainty.
  • SIGNAL: Weak bearish signal, high uncertainty.

AI Analysis

💹

For Energy Traders:

Current market indicators present a neutral sentiment with a fundamental balance of 10.90 BCFD (Change: +0.50). The Fibonacci support is at 3.24 and resistance at 3.41, indicating potential price fluctuations within this range.

With a bearish overall market sentiment score of -0.500, traders should prepare for potential downward price movements, as indicated by the ML price forecast predicting a 0.60% decrease. Short-term opportunities may arise near support levels, but caution is advised due to overall market sentiment.

⛽

For Producers (Oil & Gas Companies):

The current market conditions suggest a bearish sentiment, particularly driven by concerns over oversupply and weak demand, as highlighted in recent news articles. Producers should consider adjusting production planning accordingly to mitigate potential losses.

Given the fundamental balance of 10.90 BCFD, and the low heating and cooling demand projected, hedging strategies may need to be recalibrated to protect against price volatility. Monitoring market sentiment closely will be crucial for making informed production decisions.

🏭

For Consumers (Industrial/Utilities):

Consumers should be aware of potential cost fluctuations in energy prices, as the overall market sentiment is currently bearish. The low demand for heating and cooling, as indicated in the weather outlook, may provide some relief in pricing, but vigilance is necessary given the fundamental balance change of +0.50.

Procurement strategies should be reassessed in light of the ML price forecast predicting a 0.60% decrease, which could present cost-saving opportunities. However, the potential for volatility remains, so consider implementing hedging measures to protect against unexpected price spikes.

📊

For Commodity Professionals (Analysts, Consultants):

The energy market is currently experiencing a bearish sentiment, driven largely by oversupply concerns and low demand forecasts. The fundamental balance of 10.90 BCFD and the cooling-dominated outlook across most regions suggest a potential for lower prices in the near term.

Key driving factors include the ML price forecast indicating a 0.60% decrease, alongside a significant negative sentiment score of -0.500. Analysts should monitor geopolitical developments and supply chain dynamics closely, as these could shift market sentiment and outlook rapidly.

Disclaimer: This analysis is for informational purposes only and does not constitute financial advice. Please conduct your own research or consult a financial advisor before making any investment decisions.

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