Natural Gas News: Market Braces for EIA Data with 200-Day Moving Average in Focus

Natural Gas Traders Eye 200-Day Moving Average as EIA Inventory Report Looms

U.S. natural gas futures are nudging higher Thursday morning as traders anticipate the weekly EIA storage report. The market is caught at a key technical crossroads, balancing short-covering and profit-taking against broad expectations for another sizeable storage build. With prices straddling the 200-day moving average at $3.572, a break higher could ignite bullish momentum toward the 50-day average near $3.80.

At 12:14 GMT, Natural Gas Futures are trading $3.593, up $0.086 or +2.45%.

Is Natural Gas Setting Up for a Technical Rebound?

Support has firmed at $3.381, $3.437, and $3.453, reinforcing a buy-the-dip mentality around the 200-day MA. This zone is acting as a key battleground, discouraging fresh short positions while encouraging speculative long entries. The pattern suggests traders are defending downside breaks, hoping tighter balances or a bullish weather shift can reignite the uptrend.

Wednesday’s session saw July futures extend their decline for a third day, closing slightly lower despite near-term bullish weather potential. Traders are awaiting a catalyst as the market searches for a floor. LNG feedgas flows have ticked higher, and production remains elevated at 104.5 Bcf/day (+3.4% y/y), while dry gas demand has held steady near 69.2 Bcf/day.

Will a Hotter Weather Pattern Shift Demand Expectations?

Near-term national demand is expected to remain light to moderate, capped by mild weather across key consuming regions. However, the 7-15 day outlook suggests rising heat potential, especially in the Southwest and Texas, where highs could reach 100°F. That heat dome is forecast to expand eastward by mid-June, potentially lifting electricity-driven demand as cooling loads increase.

Still, model uncertainty remains. Forecasts have cooled slightly in recent runs, with once-anticipated hot days now sliding into the near-term and losing demand impact. Traders will need to see firm confirmation of sustained heat for bullish weather trades to materialize.

Will the EIA Inventory Build Stall Bullish Hopes?

Traders are bracing for a 107 Bcf injection in today’s EIA report—well above the five-year average of 87 Bcf. Inventories as of May 30 stood 4.7% above the seasonal norm, limiting upside price conviction. Last week’s +122 Bcf build already put bearish pressure on the market, reinforcing concerns about oversupply.

U.S. electricity output, a key demand metric, declined 2.7% y/y last week, further capping upside. Meanwhile, the Baker Hughes rig count rose to a 15-month high of 114, reflecting growing supply-side resilience.

Market Forecast: Neutral-to-Bearish Near Term

While technical support is keeping prices afloat, the broader setup leans bearish without stronger weather-driven demand or tighter inventory data. Until hotter temperatures verify and EIA reports show meaningful draws or sub-average builds, the upside looks capped near $3.80. Traders should prepare for continued chop around the 200-day average, with risks skewed to the downside if today’s storage number comes in above expectations.

More Information in our Economic Calendar.