Buying natural gas amid seasonal demand peak

A short-term decline is being observed in the natural gas (NG) market, triggered by increased supply and moderate demand in early November, following previous days of gains. However, the overall picture signals a potential resumption of an uptrend due to forecasts of colder weather towards the end of the month and early December. This traditionally leads to a higher consumption of energy resources.

From a technical perspective, downward momentum is weakening, with signs of future growth emerging. The Stochastic Oscillator, whose %K and %D lines have recently turned upward from the oversold zone, indicates increased buyer activity and exhausted selling pressure. However, further rise could be hindered by the Commodity Channel Index (CCI), which is already in the overbought zone, warning of a risk of a near-term correction. Bollinger Bands analysis adds more context. It showed that the price is again approaching the upper band ($4.560), forming a classic resistance area where upward movement often slows down or reverses.

At the same time, fundamental factors point to stronger demand for natural gas domestically and abroad. Growing energy consumption, driven by an increase in the number of data centers and electrification, is putting additional strain on the US power grid, especially under forecasted colder conditions. Furthermore, liquefied natural gas (LNG) exports remain at a high level. This underpins demand, despite record production volumes in the United States. Venture Global's capacity expansion plans also contribute to positive long-term expectations.

Immediate support for the NG market is provided by the anticipation of American statistical data publications, including the EIA report, which will probably indicate the first seasonal inventory draw, as well as the forecasted colder weather. These short-term catalysts currently outweigh record output levels, shifting the focus of attention to the approaching peak of demand.

Take into account the following trading strategy:

Buy NG at current levels (around $4.333) or during a correction to $4.050. Take profit: $4.770. Stop loss: $3.880.

The forecast remains relevant between November 20 and November 27, 2025.