Natural Gas Radar

2025-10-21 23:47

Table of Contents

Brian's Thoughts

Published: 10/21/2025 Focus: Natural Gas
Traders and news are talking about cooler forecasts on the 15 day weather that are cooler - these reports “aren’t bullish” but are showing that we should not be as bearish as the prices are showing. This is a theme we have been talking about for two weeks - that we should see some type of stability and recovery. The gap up leads me to believe this was a triggered short covering - but in many ways we are flying blind as the CFTC reports are not being published as a result of the US government budget shutdown. The extension up to 3.50 is either going to stall out here (which I think is more likely for a cool off period - pun intended) or we are going to thrust up to 3.75. While I definitely was of the opinion when we lingered below $3 recently that we “were not that bearish” I think conversely right now “we are not that bullish” - fundamentals look solid for the winter and I still believe we will see $4 and possibly $5 / $6, I just think this may be a little too much bull movement this soon. A retracement to 3.247 looks really likely as the next move.

Today's Update

Updated: 2025-10-21 23:46:24 Length: 538 chars
Natural gas prices are experiencing a notable rise, driven by cooler weather forecasts in the U.S. Traders are cautiously optimistic, suggesting that while the current uptick may not indicate strong bullish momentum, it reflects a potential for stability. The market might be overreacting, leading to a cooling-off period around $3.50. Despite this, fundamentals remain solid for winter, hinting at a possible rebound to $4 or higher. Watch for retracement levels, especially around $3.25, as the market navigates this volatile landscape.

Executive Summary

Total supply increased by 0.1 BCFD | Total demand increased by 0.6 BCFD | Market is oversupplied by 4.6 BCFD

Technical Analysis

Overall Technical Score (-5 to +5): 1 (Neutral)
Current Price: $3.54
Signal: Neutral

Moving Averages (9/20)

BEARISH

MA(9): $3.16

MA(20): $3.2

Current Price is 3.54, 9 day MA 3.16, 20 day MA 3.2

MACD (12, 26, 9)

BULLISH

MACD: 0.0524

Signal: 0.0414

Days since crossover: 1

MACD crossed the line 1 days ago and is in a bullish setup

RSI (14)

NEUTRAL

Value: 63.63

Category: NEUTRAL

RSI is 63.63 (note 70% is overbought and 30% is oversold)

Volume (vs 20d Avg)

LOWER

Current: 4,491

Avg (20d): 164,706

Ratio: 0.03

Volume is lower versus 20 day average

Stochastic (14, 3)

BULLISH CROSS

%K: 93.21

%D: 60.89

Stochastic %K: 93.21, %D: 60.89. Signal: bullish cross

ADX (14)

NO TREND

ADX: 18.21

+DI: 35.57

-DI: 19.48

ADX: 18.21 (+DI: 35.57, -DI: 19.48). Trend: no trend

Williams %R (14)

OVERBOUGHT

Value: -6.79

Williams %R: -6.79 (overbought)

Bollinger Bands (20, 2)

ABOVE MIDDLE

Upper: 3.64

Middle: 3.2

Lower: 2.76

Price vs BBands (20, 2): above middle. Upper: 3.64, Middle: 3.2, Lower: 2.76

Fundamental Analysis

Category Current (BCFD) Last Week Last Year 3 Yr Avg
Dry Production 104.6 105.2 101.5 100.9
LNG Imports 0.0 0.0 0.1 0.1
Canadian Imports 5.6 4.9 5.9 5.6
Total Supply 110.2 110.1 107.5 106.6
Industrial Demand 23.4 21.8 22.4 22.53
Electric Power Demand 31.7 35.0 37.7 33.83
Residential & Commercial 20.4 19.0 10.9 13.27
LNG Exports 16.9 16.0 12.7 12.07
Mexico Exports 6.4 6.4 6.3 6.17
Pipeline Fuel 6.8 6.8 6.6 6.7
Total Demand 105.6 105.0 96.6 94.57
Supply/Demand Balance 4.6 5.1 10.9 12.03

Weather Analysis

Weather Impact Summary

Overall: HEATING dominated (HDD: 6.7, CDD: 4.3)
Residential/Commercial: MODERATE heating demand expected
Power Generation: LOW cooling demand expected

Regional Weather Patterns

Northeast

Heating dominated (HDD: 13.0)

Midwest

Heating dominated (HDD: 7.5)

South

Cooling dominated (CDD: 3.5)

West

Cooling dominated (CDD: 18.0)

Degree Days by City

Chicago, IL

Heating Degree Days (HDD): 7.5
Cooling Degree Days (CDD): 0
Total HDD: 92.5
Total CDD: 0

New York, NY

Heating Degree Days (HDD): 13.5
Cooling Degree Days (CDD): 0
Total HDD: 88.0
Total CDD: 0

Houston, TX

Heating Degree Days (HDD): 0
Cooling Degree Days (CDD): 3.5
Total HDD: 0
Total CDD: 86.0

Los Angeles, CA

Heating Degree Days (HDD): 0
Cooling Degree Days (CDD): 18.0
Total HDD: 0
Total CDD: 102.5

Philadelphia, PA

Heating Degree Days (HDD): 12.5
Cooling Degree Days (CDD): 0
Total HDD: 79.0
Total CDD: 0

Economic Analysis

Economic Sentiment Summary

NEUTRAL - Mixed economic signals
Dollar Impact: Strong USD may pressure commodity prices
Industrial Demand: Weaker industrial demand signals
Interest Rate Impact: Stable/lower rates may support demand
Risk Sentiment: Low market volatility/risk appetite

Economic Indicators

USD_INDEX

98.9
Daily: 0.31 (0.31%)
Weekly: 0.11 (0.11%)

US_10Y

3.96
Daily: -0.02 (-0.58%)
Weekly: -0.08 (-2.05%)

SP500

6735.35
Daily: 0.22 (0.0%)
Weekly: 64.29 (0.96%)

VIX

17.87
Daily: -0.36 (-1.97%)
Weekly: -2.77 (-13.42%)

GOLD

4144.7
Daily: -191.7 (-4.42%)
Weekly: -32.2 (-0.77%)

COPPER

4.96
Daily: -0.04 (-0.82%)
Weekly: -0.02 (-0.3%)

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 decreased to 10.906 EUR/MWh (-0.015). JKM prices decreased to 11.050 USD/MMBtu (-0.095). JKM is trading at a premium of 0.144 to TTF, indicating strong Asian demand.

TTF Prices

10.906

-0.015

Front month: NOV 25

As of 2025-10-21

JKM Prices

11.050

-0.095

Front month: DEC 25

As of 2025-10-21

JKM-TTF Spread

0.144

1.32%

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

As of 2025-10-21

Forward Curves Visualization
TTF (EUR/MWh)
JKM (USD/MMBtu)
11.2
10.9
10.6
10.4
10.1
10.91
11.05
NOV 25
10.93
11.07
DEC 25
10.98
11.03
JAN 26
11.02
10.72
FEB 26
10.87
10.23
MAR 26
10.44
10.18
APR 26
10.29
10.29
MAY 26
10.29
10.45
JUN 26
10.32
10.58
JUL 26
10.37
10.63
AUG 26
10.45
10.69
SEP 26
10.53
10.92
OCT 26
TTF Forward Curve (Next 12 Months)
Month Price (EUR/MWh)
NOV 25 10.906
DEC 25 10.925
JAN 26 10.984
FEB 26 11.017
MAR 26 10.869
APR 26 10.438
MAY 26 10.293
JUN 26 10.288
JUL 26 10.319
AUG 26 10.374
SEP 26 10.454
OCT 26 10.529
JKM Forward Curve (Next 12 Months)
Month Price (USD/MMBtu)
DEC 25 11.050
JAN 26 11.075
FEB 26 11.030
MAR 26 10.720
APR 26 10.235
MAY 26 10.175
JUN 26 10.290
JUL 26 10.450
AUG 26 10.580
SEP 26 10.630
OCT 26 10.685
NOV 26 10.920

News & Sentiment Analysis

Market Sentiment Overview

NEUTRAL
Average Polarity: 0.05
Confidence: 1.0
Articles Analyzed: 51
Last Updated: 2025-10-21 23:47:17

Commodity Sentiment

CRUDE_OIL

-0.6

NATURAL_GAS

0.7

Top News Topics

Supply (6 articles)

Demand (1 articles)

Weather (2 articles)

Fibonacci Levels Analysis

Current Price: $3.54
Closest Support: $3.38 4.52% below current price
Closest Resistance: $3.59 1.41% above current price

Fibonacci Retracement Levels

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

Fibonacci Extension Levels

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

ML Price Prediction

Current Price: $3.4
Forecast Generated: 2025-10-21 23:47:18
Next Trading Day: DOWN 1.15%
Date Prediction Lower Bound Upper Bound
2025-10-21 $3.36 $3.08 $3.63
2025-10-22 $3.37 $3.1 $3.65
2025-10-23 $3.39 $3.12 $3.67
2025-10-24 $3.39 $3.11 $3.67
2025-10-25 $3.36 $3.08 $3.63

ML Insights

  • Forecast generated using ARIMA(5, 1, 0).
  • The model predicts a price decrease of ~1.15% for the next trading day (2025-10-21), reaching $3.36.
  • The 5-day forecast suggests relatively stable prices between 2025-10-21 and 2025-10-25.
  • The average confidence interval width is ~16.4% of the predicted price, indicating model uncertainty.
  • SIGNAL: Weak bearish signal, high uncertainty.

AI Analysis

💹

For Energy Traders:

The market presents a neutral technical outlook with Fibonacci support at 3.38 and resistance at 3.59. The ML price forecast indicates a potential decline of 1.15%, suggesting traders should be cautious of short-term volatility. Given the current fundamental balance of 4.60 BCFD (a decrease of 0.50), there may be short-term opportunities for profit, but the overall market sentiment remains neutral.

⛽

For Producers (Oil & Gas Companies):

The current fundamental balance indicates a slight tightening with a ratio of 1.044, which could affect production planning. Producers should consider hedging strategies in response to the neutral market sentiment and the downward pressure indicated by the ML price forecast. The news sentiment around crude oil shows mixed signals, with some articles highlighting supply risks, while others point to concerns over a potential supply glut. This divergence in sentiment may warrant a cautious approach to production adjustments.

🏭

For Consumers (Industrial/Utilities):

With the weather outlook indicating moderate heating demand in residential and commercial sectors, consumers should prepare for potential fluctuations in costs as heating demand increases. The fundamental balance remains relatively stable, but the neutral sentiment in the market suggests that procurement strategies should be flexible to adapt to any sudden price changes. Monitoring the weather forecasts will be crucial in anticipating supply reliability and managing costs effectively.

📊

For Commodity Professionals (Analysts, Consultants):

The market appears to be in a neutral state, with technical indicators pointing to a lack of momentum. The fundamental balance of 4.60 BCFD suggests stability, but the recent ML price forecast indicates a potential downward trend in the near term. Analysts should focus on the divergence in news sentiment regarding crude oil, which presents both bullish and bearish signals. Weather patterns are also a significant driving factor, especially with the current heating demand trends in the Northeast and Midwest. Overall, close monitoring of these factors will be essential for anticipating shifts in market dynamics.

Disclaimer: This analysis is for informational purposes only and should not be considered as financial advice or specific buy/sell recommendations.

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