Looking to the Futures

Natural gas was mixed for Tuesdays trading as warmer weather is anticipated in the month of May. Natural gas for May delivery, /NGK25, settled at $3.007 MMBtu, down $0.009 from previous settlement.
 

The National Oceanic and atmospheric administration (NOAA) Consistently release seasonal outlooks in regard to temperature and precipitation for North America. These outlooks are based on statistical historical models which anticipate how weather May react based upon certain variables that present themselves. The month of May is anticipated to be much warmer than normal as is the three month outlook. With this in mind, it is anticipated that People living in the lower 48 of the United States will not use as much energy to heat or cool their homes and will likely opt for a more natural alternative method to cooling their homes. 
 

Traders use this information in conjunction with inventory reports to anticipate supply and demand fluctuations.
 

On the other side of the world, the European Union (EU) is preparing plans to cut out Russian fossil fuels in an attempt to lessen reliance on the warring nation. These plans were anticipated to have been released in February but have since been delayed to May due to the uncertainty of US tariffs on the EU. The EU's primary supplier of natural gas is now Norway followed by Russia and the United States. Due to the EU's actions of moving away from Russian fossil fuels and towards The United States fossil fuels the trump administration has highlighted this need as a focus to eliminate the trade deficit with the EU.
 

Since Russia's invasion of Ukraine, Western countries have reduced their reliance on Russian fossil fuels and placed sanctions on Russian exports. Russia is seeking to remove these sanctions as peace talks with the United States as a moderator continue to progress. The United States is seeking a mineral deal with Ukraine to bring them to the table and to recognize Crimea as Russian territory to bring Russia to the table. This could lead to a reduction or removal of all sanctions by the United States on Russian goods.
 

Last week's Energy Information Administration’s natural gas inventory report indicated an increase by 16 Bcf. Inventories are currently 480 Bcf less than last year for this same time, and inventories are 74 Bcf below the five year average of 1920 Bcf.

Natural gas was mixed for Tuesdays trading as warmer weather is anticipated in the month of May. Natural gas for May delivery, /NGK25, settled at $3.007 MMBtu, down $0.009 from previous settlement. May Natural gas opened for Wednesday's trading at $3.046 MMBtu.
 

Natural gas is currently trading below the 50- and 200- day simple moving averages which is typically seen as a bearish trend. Price action is currently trading just below the 200 day SMA which may indicate short term support. The 50-day SMA is currently at $3.889, and the 200 My phone-day SMA is currently at $3.062.
 

The 14 day RSI is at 30.859% just above the 30% oversold threshold after previously bouncing from the same. This further gives an indication to possible short term support as Natural gas trades along the 200-day SMA. 
 

The directional movement index indicates a bearish trend. The ADX (white) is elevated indicating a strong directional trend. The negative directional index (Red) is elevated above the positive directional index (green).

MBA Mortgage Applications Index 7:00 AM ET

S&P Global US Manufacturing PMI preliminary 9:45 AM ET

S&P Global US Services PMI preliminary 9:45 AM ET

New Home Sales 10:00 AM ET

EIA Crude Oil Inventories 10:30 AM ET 

Fed’s Beige Book 2:00 PM ET