Natural Gas Radar

2025-10-23 23:47

Table of Contents

Brian's Thoughts

Published: 10/23/2025 Focus: Natural Gas
As we rallied to $3.50 - we quickly bounced off - leaving questions of what might be coming (my thought - I think we’re headed back down to 3.247). We have been in a land of extremes - 2.92 was TOO LOW, conversely 3.50 is TOO HIGH (in my humble opinion) - I think the goldilocks zone is 3.247 which I think is coming next. The large reason for the run up is what I believe to be short covering - however we can not confirm that as the CFTC is not reporting positions since 9/23 (another victim of the government shutdown).

Today's Update

Updated: 2025-10-23 23:46:26 Length: 517 chars
Natural gas prices have recently retreated, hovering around $3.50, as rising EIA inventories cast a bearish shadow on the market. Recent data indicates a larger-than-expected storage build, contributing to concerns about oversupply. The market appears to be in a tug-of-war between short covering and fundamental supply issues, with many experts suggesting the “Goldilocks” zone for prices could settle around $3.247. Watch for inventory updates and weather forecasts, which could sway market sentiment significantly.

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: $3.29
Signal: Neutral

Moving Averages (9/20)

BEARISH

MA(9): $3.19

MA(20): $3.25

Current Price is 3.29, 9 day MA 3.19, 20 day MA 3.25

MACD (12, 26, 9)

BULLISH

MACD: 0.0627

Signal: 0.0485

Days since crossover: 3

MACD crossed the line 3 days ago and is in a bullish setup

RSI (14)

NEUTRAL

Value: 54.06

Category: NEUTRAL

RSI is 54.06 (note 70% is overbought and 30% is oversold)

Volume (vs 20d Avg)

LOWER

Current: 2,556

Avg (20d): 185,039

Ratio: 0.01

Volume is lower versus 20 day average

Stochastic (14, 3)

BEARISH CROSS

%K: 58.47

%D: 74.82

Stochastic %K: 58.47, %D: 74.82. Signal: bearish cross

ADX (14)

NO TREND

ADX: 18.82

+DI: 31.2

-DI: 21.7

ADX: 18.82 (+DI: 31.2, -DI: 21.7). Trend: no trend

Williams %R (14)

NEUTRAL

Value: -41.53

Williams %R: -41.53 (neutral zone)

Bollinger Bands (20, 2)

ABOVE MIDDLE

Upper: 3.64

Middle: 3.25

Lower: 2.86

Price vs BBands (20, 2): above middle. Upper: 3.64, Middle: 3.25, Lower: 2.86

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: 12.2, CDD: 3.3)
Residential/Commercial: MODERATE heating demand expected
Power Generation: LOW cooling demand expected

Regional Weather Patterns

Northeast

Heating dominated (HDD: 15.2)

Midwest

Heating dominated (HDD: 16.5)

South

Heating dominated (HDD: 14.0)

West

Cooling dominated (CDD: 16.5)

Degree Days by City

Chicago, IL

Heating Degree Days (HDD): 16.5
Cooling Degree Days (CDD): 0
Total HDD: 123.0
Total CDD: 0

New York, NY

Heating Degree Days (HDD): 13.5
Cooling Degree Days (CDD): 0
Total HDD: 112.0
Total CDD: 0

Houston, TX

Heating Degree Days (HDD): 14.0
Cooling Degree Days (CDD): 0.0
Total HDD: 19.5
Total CDD: 77.0

Los Angeles, CA

Heating Degree Days (HDD): 0
Cooling Degree Days (CDD): 16.5
Total HDD: 0
Total CDD: 115.0

Philadelphia, PA

Heating Degree Days (HDD): 17.0
Cooling Degree Days (CDD): 0
Total HDD: 101.0
Total CDD: 0

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

99.01
Daily: 0.11 (0.12%)
Weekly: 0.58 (0.59%)

US_10Y

3.99
Daily: 0.04 (0.96%)
Weekly: -0.02 (-0.4%)

SP500

6738.44
Daily: 39.04 (0.58%)
Weekly: 74.43 (1.12%)

VIX

17.3
Daily: -1.3 (-6.99%)
Weekly: -3.48 (-16.75%)

GOLD

4130.0
Daily: 85.6 (2.12%)
Weekly: -59.9 (-1.43%)

COPPER

5.11
Daily: 0.15 (3.06%)
Weekly: 0.18 (3.68%)

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 10.901 EUR/MWh (-0.043). JKM prices decreased to 11.155 USD/MMBtu (-0.060). JKM is trading at a premium of 0.254 to TTF, indicating strong Asian demand.

TTF Prices

10.901

-0.043

Front month: NOV 25

As of 2025-10-23

JKM Prices

11.155

-0.060

Front month: DEC 25

As of 2025-10-23

JKM-TTF Spread

0.254

2.33%

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

As of 2025-10-23

Forward Curves Visualization
TTF (EUR/MWh)
JKM (USD/MMBtu)
11.3
11.0
10.7
10.5
10.2
10.90
11.15
NOV 25
10.93
11.19
DEC 25
11.01
11.12
JAN 26
11.05
10.82
FEB 26
10.92
10.30
MAR 26
10.51
10.29
APR 26
10.37
10.41
MAY 26
10.36
10.54
JUN 26
10.39
10.69
JUL 26
10.45
10.74
AUG 26
10.53
10.78
SEP 26
10.61
11.02
OCT 26
TTF Forward Curve (Next 12 Months)
Month Price (EUR/MWh)
NOV 25 10.901
DEC 25 10.931
JAN 26 11.013
FEB 26 11.053
MAR 26 10.920
APR 26 10.507
MAY 26 10.368
JUN 26 10.360
JUL 26 10.390
AUG 26 10.445
SEP 26 10.532
OCT 26 10.606
JKM Forward Curve (Next 12 Months)
Month Price (USD/MMBtu)
DEC 25 11.155
JAN 26 11.190
FEB 26 11.120
MAR 26 10.825
APR 26 10.305
MAY 26 10.295
JUN 26 10.410
JUL 26 10.545
AUG 26 10.690
SEP 26 10.745
OCT 26 10.780
NOV 26 11.020

News & Sentiment Analysis

Market Sentiment Overview

BEARISH
Average Polarity: -0.5
Confidence: 1.0
Articles Analyzed: 99
Last Updated: 2025-10-23 23:47:19

Commodity Sentiment

NATURAL_GAS

-0.4

CRUDE_OIL

-0.6

Top News Topics

Supply (7 articles)

Demand (3 articles)

Infrastructure (1 articles)

Geopolitical (10 articles)

Weather (3 articles)

Fibonacci Levels Analysis

Current Price: $3.29
Closest Support: $3.22 2.13% below current price
Closest Resistance: $3.38 2.74% 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 Support
0.786 $3.38 Resistance
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: $3.34
Forecast Generated: 2025-10-23 23:47:19
Next Trading Day: UP 0.39%
Date Prediction Lower Bound Upper Bound
2025-10-24 $3.36 $3.08 $3.63
2025-10-25 $3.32 $3.04 $3.6
2025-10-26 $3.31 $3.04 $3.59
2025-10-27 $3.31 $3.04 $3.59
2025-10-28 $3.32 $3.05 $3.6

ML Insights

  • Forecast generated using ARIMA(5, 1, 0).
  • The model predicts a price increase of ~0.39% for the next trading day (2025-10-24), reaching $3.36.
  • The 5-day forecast suggests a generally downward trend, moving about -1.2% between 2025-10-24 and 2025-10-28.
  • The average confidence interval width is ~16.6% of the predicted price, indicating model uncertainty.
  • SIGNAL: Weak bullish signal, high uncertainty.

AI Analysis

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For Energy Traders:

The current market conditions indicate a neutral technical outlook with a score of 1/5. Key Fibonacci support is at 3.22 and resistance at 3.38. The ML price forecast suggests a potential upward movement of 0.39%, indicating a range between 3.08 and 3.63. Given this, traders should monitor price action around these levels for potential volatility and short-term trading opportunities. However, the overall bearish sentiment (-0.400) could pose risks, necessitating caution in positioning.

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For Producers (Oil & Gas Companies):

The fundamental balance is currently at 4.60 BCFD with a slight decrease of -0.50. Producers should consider this when planning production levels, as a slight reduction in demand may influence operational strategies. The bearish sentiment in the market (-0.400) suggests that hedging strategies may be prudent to mitigate price risks. Additionally, the heating demand forecast indicates moderate conditions, which could influence natural gas consumption patterns, affecting supply planning.

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For Consumers (Industrial/Utilities):

With the weather outlook indicating moderate heating demand and low cooling demand, consumers should prepare for potential fluctuations in costs. The bearish market sentiment could lead to lower prices, but the fundamental balance at 4.60 BCFD suggests careful monitoring of supply reliability. Consumers should consider strategic procurement options or hedging to protect against unexpected price increases as the winter season approaches.

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For Commodity Professionals (Analysts, Consultants):

The market is currently influenced by several factors, with a predominant bearish sentiment (-0.400) impacting both natural gas and crude oil. The fundamental balance indicates slight oversupply, while the weather outlook suggests increased heating demand across regions, notably in the Northeast and Midwest. Analysts should focus on these regional patterns and the implications for price movements, as well as the overall market sentiment which may shift with changing weather conditions and geopolitical developments.

Disclaimer: This analysis is for informational purposes only and does not constitute financial advice or specific buy/sell recommendations.

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