Natural Gas Showing Bullish Price Action

 

 

 Video Analysis Link Below

 

https://youtu.be/h1FgBPcKrCA

 

As of March 5, 2025, here’s the latest news on natural gas based on available information:

 

Natural gas markets are showing significant activity. U.S. natural gas futures have recently surged, with prices climbing about 10% to a 26-month high as of March 4, 2025. This spike is driven by record flows to liquefied natural gas (LNG) export plants and concerns over potential tariffs on Canadian imports, reflecting bullish sentiment despite some weather-related demand fluctuations. 

 

The latest U.S. Energy Information Administration (EIA) report indicated a substantial withdrawal of 261 billion cubic feet (Bcf) from storage, leaving inventories at 1,840 Bcf—well below last year’s levels and the five-year average, tightening supply outlooks. Globally, LNG developments are making headlines. 

 

On March 4, 2025, Vitol, a major energy trader, signed a long-term LNG supply deal with LNGPH in the Philippines, aimed at supporting 18% of Luzon’s power needs and advancing the country’s shift to cleaner energy. Meanwhile, ExxonMobil announced plans on March 4 to ramp up natural gas output in Guyana, targeting both domestic power needs and LNG exports, with fertilizer production also in scope. 

 

In Asia, Tokyo Gas acquired a 20% stake in a Philippine LNG terminal on March 4, marking its first overseas operational LNG terminal investment. Market dynamics are also shifting. Analysts note that despite warmer weather forecasts potentially softening demand midweek in the U.S., geopolitical risks and strong LNG export demand are keeping prices supported. 

 

Analyst highlight the focus on record LNG flows and tariff worries as key price drivers. Additionally, the Trump administration’s push to lift restrictions on LNG export projects, including potential approval of the Commonwealth LNG facility in Louisiana, could further bolster U.S. export capacity.

 

In summary, natural gas news reflects a mix of robust export growth, tightening domestic supplies, and strategic international deals, all shaping a dynamic market as of early March 2025.

February 23rd 2025 Weekly Forecast On Natural Gas!

 

Video Analysis Link Below

https://youtu.be/Z7nVW6FPq80

 Predicting where natural gas prices will close for the upcoming week—starting Monday, February 24, 2025—is tricky because it depends on a lot of moving parts like weather, supply, demand, and market sentiment. I don’t have a crystal ball, but I can give you a sense of what might happen based on current trends and insights.

Right now, as of February 23, 2025, natural gas prices are influenced by a mix of factors. The Henry Hub spot price was at $7.78 per million British thermal units (MMBtu) last Wednesday, February 19, after a big jump from $3.94 the week before, driven by colder weather across the U.S. Futures for March 2025 were up to $4.280/MMBtu by that same Wednesday, showing the market’s expecting some sustained demand. But here’s the catch: forecasts are hinting at milder weather in places like the Northeast next week, with temperatures possibly hitting the 50s. Warmer weather could cool off demand for heating, which might pull prices down a bit.

On the flip side, storage levels are tighter than usual—2,101 billion cubic feet (Bcf) as of February 14, which is 5% below the five-year average—and withdrawals have been hefty lately (196 Bcf last week alone). That tightness could keep prices supported if cold snaps linger elsewhere or if LNG exports stay strong. Speaking of exports, the U.S. is shipping out a ton of liquefied natural gas—110 Bcf left ports between February 13 and 19—so global demand might prop things up too.

Looking at short-term forecasts, some analysts peg natural gas prices for Thursday, February 27, at around $3.812/MMBtu, with a range between $3.621 and $4.003. That’s a drop from last week’s highs, suggesting a possible easing off. Some also hint at a potential pullback, with milder weather in the forecast and some traders betting on a downward shift into March.

So, where might it close by Friday, February 28? If the milder weather dominates and storage worries don’t spike, I’d lean toward a close in the $3.50 to $3.80/MMBtu range—maybe around $3.70. But if unexpected cold hits or supply hiccups pop up, it could stick closer to $4.00 or even nudge higher. It’s a coin toss, really, and the market’s been jumpy lately, so anything’s possible.

Natural Gas February Trends 2025

 Natural Gas February Trends

Looking at broader trends, the U.S. Energy Information Administration (EIA) data up to early February 2025 (from their latest updates) showed inventories at 2,297 billion cubic feet (Bcf) as of February 7, down 100 Bcf from the prior week—below last year’s levels and the five-year average. This drawdown aligns with the cold snap.  Prices at the Henry Hub, a key benchmark, were around $3.22/MMBtu on February 5 (per EIA’s weekly update), some suggest they’ve since climbed past $4.2 by February 19, reflecting a rapid response to weather and export dynamics.

 

Weather’s a big driver here. February 2025 has apparently brought colder-than-expected conditions across parts of the U.S., increasing heating demand and straining production (frozen wells don’t help). Meanwhile, LNG exports are hitting records, likely due to new facilities like Plaquemines and Corpus Christi Stage 3 ramping up, as noted in late 2024 forecasts. This combo—high domestic use plus export pressure—seems to be pushing prices up and inventories down faster than usual for late February.

 

February 18 warned of a potential warming trend late in the month, which could ease demand and lead to price dips if supply stabilizes. Volatility’s clearly in play, as they noted a smaller-than-expected inventory draw of 116 Bcf (possibly from an earlier EIA report this month), hinting supply might not be as tight as the price surge suggests.

So, natural gas in February 2025 is showing a lively mix: bullish price spikes driven by cold weather and LNG exports, tempered by whispers of a possible late-month cooldown.

Natural Gas Failing The 1x1 = 45Deg Gann Fan

Looking at the price action of natural gas, we saw it break through the 1x1 45-degree angle on January 13, 2025. Initially, it held above it for a short time, but ultimately, it couldn't sustain the momentum and failed. I explain this theory in more detail in a video on my YouTube channel, WD Gann Price and Time.

There’s a scene in The Matrix where Neo jumps off a building for the first time, convinced he’ll make it. But the reality is, most of the time, when you take that leap for the first time, you fail. This is similar to natural gas—after touching the 1x1 angle for the first time in a while, it also failed to maintain its position.

 

The WD Gann Technique: A Look at the Gann Fan

The Gann Fan is one of the key tools used in the trading methods developed by William Delbert Gann, a legendary financial analyst and trader in the early 20th century. Gann’s techniques, which combine geometry, astrology, and numerology, have become the subject of fascination among traders and market analysts. The Gann Fan, in particular, is a unique and powerful tool that traders use to predict price movements and identify potential support and resistance levels.

In this article, we will explore what the Gann Fan is, how it works, and how traders can use it in their trading strategies.

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What is the Gann Fan?

The Gann Fan is a technical analysis tool that consists of a series of diagonal lines, or “fan lines,” drawn from a significant price point on a chart. These lines are drawn at specific angles, based on Gann’s theories of geometry and time cycles, and are used to predict future price movements.

The fan lines are drawn at specific angles to represent different time and price relationships. According to Gann’s methods, the angles at which these lines are drawn have special significance and are believed to provide insights into potential support and resistance levels, as well as the future direction of the market.

The main angles used in the Gann Fan include:

• 1x1 Angle (45 degrees): This is the most important angle, representing a perfect balance between time and price. It’s often referred to as the “primary” angle in Gann’s methodology. A price moving along this line indicates that the market is balanced in terms of time and price.

• 1x2 Angle (26.25 degrees): This angle indicates that price is moving at half the rate of time. A price moving along this line suggests a slower price movement relative to the time passed.

• 2x1 Angle (63.75 degrees): This angle represents a faster price movement relative to time. A price moving along this line indicates a more aggressive or strong market trend.

• Other angles: Gann also used other ratios, including 1x3, 3x1, 1x4, 4x1, and so on. Each of these angles can help traders identify different price and time relationships.

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How the Gann Fan is Drawn

To draw a Gann Fan on a chart, traders typically follow these steps:

1. Identify a Significant Price Point: The first step is to select a key high or low point on the chart that is significant for the asset or market being analyzed. This point is often chosen based on historical price movements, such as major peaks or troughs.

2. Draw the First Fan Line (1x1): Starting from the identified point, a diagonal line is drawn at a 45-degree angle. This is the 1x1 line, and it represents the balance between time and price.

3. Draw Additional Fan Lines: Other lines are drawn at the predetermined angles (1x2, 2x1, 1x3, etc.). These lines are drawn either above or below the 1x1 line, depending on whether the market is trending upward or downward.

4. Observe Price Interaction: Once the fan lines are drawn, traders observe how the price interacts with them. If the price is moving toward a fan line, it may act as a support or resistance level. The Gann Fan can provide clues as to where future price movements may occur, helping traders make more informed decisions.

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How to Use the Gann Fan in Trading

The Gann Fan is a versatile tool that can be used in different market conditions. Here’s how traders typically use the Gann Fan:

1. Support and Resistance Levels: The fan lines act as potential support and resistance levels. If the price is approaching an upward-sloping fan line, it could encounter resistance. Conversely, if the price is approaching a downward-sloping fan line, it might find support. By observing these interactions, traders can set entry and exit points for trades.

2. Trend Identification: The Gann Fan can help traders identify the strength of a trend. If the price is moving consistently along a particular fan line (especially the 1x1 angle), it suggests a balanced market with a steady trend. If the price breaks through a fan line, it could indicate a trend reversal or a significant change in market dynamics.

3. Time and Price Projections: Gann’s technique is based on the relationship between time and price. By using the Gann Fan, traders can estimate future price movements based on the angles of the fan lines. For example, if a price reaches a 1x1 line, it could signify that the price has moved a certain distance over a specific period, and the trader can project future price action accordingly.

4. Confluence with Other Indicators: The Gann Fan is often used in conjunction with other technical analysis tools such as Fibonacci retracement levels, moving averages, or oscillators. When the Gann Fan lines align with other indicators, it can provide stronger signals of potential price reversals or trend continuation.

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Limitations of the Gann Fan

Despite its usefulness, the Gann Fan is not without its limitations. Here are a few points to consider when using the tool:

1. Subjectivity: Drawing the fan lines is somewhat subjective. Different traders may draw the lines in slightly different locations, which can lead to varying interpretations of the same chart.

2. Complexity: The Gann Fan requires a deep understanding of Gann’s theories and the various angles involved. For novice traders, it can be a complex tool to master, and it may take time and experience to use it effectively.

3. Market Conditions: Like any other technical analysis tool, the Gann Fan works best in trending markets. In choppy or sideways markets, the fan lines may not be as effective in predicting future price movements.

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Conclusion

The Gann Fan remains one of the most iconic and intriguing tools in the world of technical analysis. Though it may appear complex at first glance, it provides valuable insights into price movements, trend strength, and potential support and resistance levels. By understanding how to use the Gann Fan effectively, traders can gain a unique perspective on market dynamics and make more informed trading decisions.

However, like any other trading technique, the Gann Fan should not be relied upon in isolation. It’s best used in conjunction with other tools and indicators, as part of a broader trading strategy. With practice and a solid understanding of Gann’s theories, traders can harness the power of the Gann Fan to enhance their trading success.

Natural Gas Seasonality

Natural Gas Seasonality

 

Natural gas seasonality refers to the predictable patterns in natural gas demand and prices that occur at certain times of the year, primarily driven by weather-related factors. The most significant influence on natural gas seasonality is weather, particularly in regions with cold winters and hot summers. Here's how it typically breaks down:

1. Winter (November to March):

   • High Demand: Cold temperatures increase heating demand, leading to higher consumption of natural gas for residential and commercial heating.
   • Price Surge: This increased demand often drives prices higher, particularly in colder regions like the U.S. Northeast and Midwest.
   • Storage Depletion: Natural gas inventories tend to be lower at the start of winter, adding to the price volatility as supply tightens.

2. Summer (June to September):

   • Moderate to High Demand: In hot climates, air conditioning systems increase the demand for natural gas to generate electricity. However, demand is typically lower than in winter.
   • Price Movement: Prices may rise during summer months due to power generation needs, but they are usually more stable compared to the winter surge.

3. Shoulder Seasons (Spring and Fall):

   • Lower Demand: Spring and fall months generally see milder weather, resulting in less heating or cooling demand. As a result, consumption decreases.
   • Storage Replenishment: During these seasons, natural gas storage facilities are often refilled in preparation for winter, potentially keeping prices lower.
   • Price Stability: With relatively balanced supply and demand, prices are typically more stable during these months, although they can fluctuate based on factors like storage levels and production rates.

Key Influencing Factors:

• Weather Variability: Extreme cold or heat can lead to unpredictable price movements. A harsh winter or summer spike can cause short-term price surges.
• Supply and Storage: The level of natural gas inventories heading into winter (typically replenished during summer) and production levels can affect seasonal price movements.
• Global Events: Natural gas prices are also influenced by geopolitical events, natural disasters, and shifts in global energy demand, which can disrupt seasonal trends.

Understanding natural gas seasonality is crucial for traders, energy producers, and consumers to anticipate potential price fluctuations and manage risk.