September Natural Gas Futures Crash Amid Forecast of Cooler Temperatures
Natural gas futures took a sharp hit on Tuesday as traders reacted to a forecast showing cooler temperatures across the central and eastern United States. The September contract fell to a three-month low, underperforming against expectations.
The previous low at $2.799 provided resistance, while the swing top at $2.979 and the 50-day moving average at $3.085 remain as potential barriers to further declines. However, the market's steep drop below the 50-day MA, down by $0.40, has some analysts suggesting that September natural gas may be getting close to being oversold.
The Texas Plains have been experiencing high temperatures in the 90s and 100s, but it hasn't been enough to carry the national market. The Midwest, Great Lakes, and Northeast are crucial regions for national demand, and they've been receiving relief from cooler temperatures before heat can build up sustainably.
While seven-day demand remains high according to NatGasWeather, regional coverage has not had a significant impact on the market all summer.