Natural Gas Radar

2025-10-16 12:22

Table of Contents

Brian's Thoughts

Published: 10/16/2025 Focus: Natural Gas
Nat Gas forecasts are bearish - yet we are still set for potential upside volatility this winter - forecasts have led to a likelihood of volatility - that doesn’t mean that we will have a ton of polar vortexes and it also doesn’t mean we will have NO polar vortexes - it means the jet stream will allow as many or as few polar vortexes as the weather patterns allow - translation - it could be FIVE or it could be ZERO. Let’s just say, I would not want to enter the winter short - as this could be set up for upside volatility. This week is all about 3.127 - if the bulls recapture that level AND 3.247 then we could see a potential uptrend re-emerge…but as it stands right now - we are likely headed down to “fill the gap” from the rollover at 2.924. Tuesday’s trading tested the $3 support and successfully bounced - although on low volume….this is a TBC as this was not convincing with a $3 support and 3.127 resistance.

Today's Update

Updated: 2025-10-16 12:21:45 Length: 551 chars
Natural Gas prices face a bearish outlook, yet winter may bring unexpected volatility due to uncertain weather patterns. Currently, prices hover around $3, with key resistance at 3.127 and support at $2.924. Recent storage reports show expected increases, while mild weather forecasts have pressured prices. Traders should be cautious; a shift in weather could lead to significant upside volatility. Monitoring the interplay between temperature forecasts and storage data will be crucial in navigating this market. Stay warm, but don’t short too soon!

Executive Summary

Total supply decreased by 0.7 BCFD | Total demand increased by 5.1 BCFD | Market is oversupplied by 5.1 BCFD

Technical Analysis

Overall Technical Score (-5 to +5): -2 (Moderately Bearish)
Current Price: $3.0
Signal: Moderately Bearish

Moving Averages (9/20)

BULLISH

MA(9): $3.19

MA(20): $3.13

Current Price is 3.0, 9 day MA 3.19, 20 day MA 3.13

MACD (12, 26, 9)

BEARISH

MACD: 0.0161

Signal: 0.0538

Days since crossover: 4

MACD crossed the line 4 days ago and is in a bearish setup

RSI (14)

NEUTRAL

Value: 44.22

Category: NEUTRAL

RSI is 44.22 (note 70% is overbought and 30% is oversold)

Volume (vs 20d Avg)

LOWER

Current: 87,514

Avg (20d): 166,847

Ratio: 0.52

Volume is lower versus 20 day average

Stochastic (14, 3)

BEARISH CROSS

%K: 5.96

%D: 21.56

Stochastic %K: 5.96, %D: 21.56. Signal: bearish cross

ADX (14)

NO TREND

ADX: 16.68

+DI: 21.83

-DI: 24.3

ADX: 16.68 (+DI: 21.83, -DI: 24.3). Trend: no trend

Williams %R (14)

OVERSOLD

Value: -94.04

Williams %R: -94.04 (oversold)

Bollinger Bands (20, 2)

BELOW MIDDLE

Upper: 3.59

Middle: 3.13

Lower: 2.68

Price vs BBands (20, 2): below middle. Upper: 3.59, Middle: 3.13, Lower: 2.68

Fundamental Analysis

Category Current (BCFD) Last Week Last Year 3 Yr Avg
Dry Production 105.2 105.8 101.7 100.87
LNG Imports 0.0 0.0 0.1 0.1
Canadian Imports 4.9 5.0 5.7 5.63
Total Supply 110.1 110.8 107.4 106.63
Industrial Demand 21.8 22.0 22.1 22.17
Electric Power Demand 35.0 37.0 38.6 35.13
Residential & Commercial 19.0 11.5 9.4 10.9
LNG Exports 16.0 15.8 12.4 12.07
Mexico Exports 6.4 6.8 6.7 6.37
Pipeline Fuel 6.8 6.8 6.6 6.67
Total Demand 105.0 99.9 95.9 93.33
Supply/Demand Balance 5.1 10.9 11.5 13.3

Weather Analysis

Weather Impact Summary

Overall: HEATING dominated (HDD: 7.8, CDD: 3.9)
Residential/Commercial: MODERATE heating demand expected
Power Generation: LOW cooling demand expected

Regional Weather Patterns

Northeast

Heating dominated (HDD: 12.2)

Midwest

Heating dominated (HDD: 14.5)

South

Cooling dominated (CDD: 13.5)

West

Cooling dominated (CDD: 6.0)

Degree Days by City

Chicago, IL

Heating Degree Days (HDD): 14.5
Cooling Degree Days (CDD): 0.0
Total HDD: 55.5
Total CDD: 2.5

New York, NY

Heating Degree Days (HDD): 11.0
Cooling Degree Days (CDD): 0
Total HDD: 51.5
Total CDD: 0

Houston, TX

Heating Degree Days (HDD): 0
Cooling Degree Days (CDD): 13.5
Total HDD: 0
Total CDD: 134.5

Los Angeles, CA

Heating Degree Days (HDD): 0
Cooling Degree Days (CDD): 6.0
Total HDD: 0
Total CDD: 92.5

Philadelphia, PA

Heating Degree Days (HDD): 13.5
Cooling Degree Days (CDD): 0
Total HDD: 49.5
Total CDD: 0

Economic Analysis

Economic Sentiment Summary

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

Economic Indicators

USD_INDEX

98.49
Daily: -0.3 (-0.31%)
Weekly: -0.49 (-0.5%)

US_10Y

4.02
Daily: -0.03 (-0.72%)
Weekly: -0.03 (-0.84%)

SP500

6658.17
Daily: -12.89 (-0.19%)
Weekly: 105.66 (1.61%)

VIX

21.59
Daily: 0.95 (4.6%)
Weekly: -0.07 (-0.32%)

GOLD

4293.9
Daily: 117.0 (2.8%)
Weekly: 318.0 (8.0%)

COPPER

5.01
Daily: 0.03 (0.66%)
Weekly: 0.16 (3.23%)

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 10.894 EUR/MWh (+0.019). JKM prices decreased to 11.016 USD/MMBtu (-0.014). JKM is trading at a premium of 0.122 to TTF, indicating strong Asian demand.

TTF Prices

10.894

+0.019

Front month: NOV 25

As of 2025-10-16

JKM Prices

11.016

-0.014

Front month: NOV 25

As of 2025-10-16

JKM-TTF Spread

0.122

1.12%

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

As of 2025-10-16

Forward Curves Visualization
TTF (EUR/MWh)
JKM (USD/MMBtu)
11.3
11.0
10.8
10.5
10.3
10.89
11.02
NOV 25
10.94
11.04
DEC 25
11.02
11.18
JAN 26
11.06
11.13
FEB 26
10.92
10.85
MAR 26
10.52
10.39
APR 26
10.38
10.35
MAY 26
10.38
10.44
JUN 26
10.40
10.60
JUL 26
10.46
10.74
AUG 26
10.54
10.78
SEP 26
10.61
10.82
OCT 26
TTF Forward Curve (Next 12 Months)
Month Price (EUR/MWh)
NOV 25 10.894
DEC 25 10.939
JAN 26 11.024
FEB 26 11.056
MAR 26 10.918
APR 26 10.522
MAY 26 10.380
JUN 26 10.377
JUL 26 10.402
AUG 26 10.455
SEP 26 10.537
OCT 26 10.607
JKM Forward Curve (Next 12 Months)
Month Price (USD/MMBtu)
NOV 25 11.016
DEC 25 11.045
JAN 26 11.175
FEB 26 11.130
MAR 26 10.845
APR 26 10.395
MAY 26 10.350
JUN 26 10.440
JUL 26 10.600
AUG 26 10.740
SEP 26 10.780
OCT 26 10.820

News & Sentiment Analysis

Market Sentiment Overview

BEARISH
Average Polarity: -0.3
Confidence: 1.0
Articles Analyzed: 83
Last Updated: 2025-10-16 12:22:33

Commodity Sentiment

NATURAL_GAS

0.0

CRUDE_OIL

-0.6

Top News Topics

Supply (6 articles)

Demand (1 articles)

Infrastructure (1 articles)

Weather (5 articles)

Fibonacci Levels Analysis

Current Price: $3.0
Closest Support: $2.99 0.33% below current price
Closest Resistance: $3.1 3.33% above current price

Fibonacci Retracement Levels

0.0 $2.62
0.236 $2.85
0.382 $2.99 Support
0.5 $3.1 Resistance
0.618 $3.22
0.786 $3.38
1.0 $3.59

Fibonacci Extension Levels

1.272 $3.85
1.618 $4.18
2.0 $4.55
2.618 $5.14

ML Price Prediction

Current Price: $3.02
Forecast Generated: 2025-10-16 12:22:33
Next Trading Day: UP 0.07%
Date Prediction Lower Bound Upper Bound
2025-10-16 $3.02 $2.78 $3.25
2025-10-17 $3.03 $2.79 $3.26
2025-10-18 $3.02 $2.79 $3.26
2025-10-19 $3.03 $2.8 $3.27
2025-10-20 $3.03 $2.8 $3.27

ML Insights

  • Forecast generated using ARIMA(5, 1, 0).
  • The model predicts a price increase of ~0.07% for the next trading day (2025-10-16), reaching $3.02.
  • The 5-day forecast suggests relatively stable prices between 2025-10-16 and 2025-10-20.
  • The average confidence interval width is ~15.5% of the predicted price, indicating model uncertainty.
  • SIGNAL: Weak bullish signal, high uncertainty.

AI Analysis

💹

For Energy Traders:

Current market sentiment is bearish, with a technical score of -2/5. The Fibonacci support level is at 2.99, while resistance is at 3.1. This indicates potential price challenges in breaking above resistance.

Short-term ML price forecasts suggest a slight increase of 0.07%, but the overall bearish sentiment and fundamental balance of 5.10 BCFD with a significant change of -5.80 indicate potential volatility and risks in trading.

⛽

For Producers (Oil & Gas Companies):

With the current bearish sentiment and a fundamental balance indicating a reduction in demand, producers may need to reconsider production planning and adjust output accordingly to avoid oversupply.

Hedging strategies should be evaluated against the backdrop of current market conditions, particularly given the risks highlighted by the negative news sentiment surrounding crude oil and potential supply gluts.

🏭

For Consumers (Industrial/Utilities):

Consumers should be aware of potential cost fluctuations due to the current bearish market sentiment. The moderate heating demand indicated by the weather outlook suggests that procurement strategies may need to be adjusted to ensure supply reliability.

Given the low cooling demand forecast, utilities may find opportunities to optimize their energy sourcing strategies in the near term, aligning with the predicted price range of 2.78 to 3.25.

📊

For Commodity Professionals (Analysts, Consultants):

The market is currently influenced by a convergence of bearish sentiment and technical indicators pointing towards potential resistance levels. The supply-demand dynamics show a fundamental balance that could lead to downward pressure on prices.

Key driving factors include the weather outlook indicating increased heating demand across several regions, juxtaposed with a general bearish sentiment in the crude oil market. Analysts should monitor these trends closely for potential shifts in market outlook.

Disclaimer: The insights provided are for informational purposes only and do not constitute financial advice or specific buy/sell recommendations.

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