US natural gas prices launch trade with big bullish price gap on colder weather forecasts
US natural gas price (NATGAS) are trading over 7% higher this morning after launching today's trade with an over-8% bullish price gap. Price tested $7.00/MMBTu resistance zone today, following an attack on the $6.30-6.40 zone on Friday. Price has now recovered a third of the latest major downward impulse and has broken above the downward channel in which it traded since early-August. The aforementioned $6.30-6.40 price zone, along with 23.6% retracement of the downward impulse, can now be seen as a key near-term support should bears attempt to fill the price gap.
Source: xStation5
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US weather forecasts for the coming days point that temperatures in key heating regions will be lower than usual. This means that the US heating season may already be underway. Source: NOAA
Interestingly, 5-year seasonal patterns suggest that significant natural gas price jumps are set to occur by the end of this week. Simultaneously, forecasts for Europe still point to higher-than-average temperatures, what is triggering a 3-4% drop in European natural gas price today.
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