Since November 1, the price of natural gas has fallen by more than 30%. This was facilitated by:
→ relatively mild weather at the beginning of the winter period;
→ record volumes of liquefied gas production, as reported by Reuters. Analysts estimate there is currently about 7.8% more gas in storage than normal for this time of year.
On December 13, the price of natural gas dropped below 2.20 for the first time since the beginning of June. This level may provide support given how price has interacted with it throughout 2023.
At the same time, the graph shows that the price of natural gas:
→ is within a downward trend (shown in red);
→ On December 11, a surge in demand was noticed on the market (shown by the arrow) — it is possible that it was caused by a low price and the expectation that in the future the price of gas could rise until the end of winter;
→ the median line still offers resistance;
→ RSI forms divergence.
Thus, there are reasons to believe that the level of 2.20 may be able to stop the downward trend. And even to provide support for a rebound if the weather becomes colder and causes an increase in gas consumption.
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