Technically, momentum is pointing lower with the 200-day moving average the next target at $3.560. This is followed by a pair of main bottoms at $3.437 and $3.381.
On the upside, gains are being capped by three tops at $3.791, $3.832 and $3.859. The most important resistance is the 50-day moving average at $3.900.
Is the Market Responding to Oversupply Signals from the EIA Report?
The latest EIA report showed a 122 Bcf build in working gas for the week ending May 30, pushing total inventories to 2,598 Bcf. That puts stocks 117 Bcf above the five-year average and 288 Bcf below year-ago levels.
This marks the third straight week of triple-digit builds, underscoring ample supply ahead of the peak cooling season. The South Central and Midwest regions led the gains, adding 34 Bcf and 38 Bcf respectively—an indication that weather-driven demand remains too weak to dent storage growth meaningfully.
Can Heat in the West Overcome Soft Demand Elsewhere?
While temperatures are rising across California and the Desert Southwest—where highs are climbing into the triple digits—the broader U.S. is seeing only modest summer conditions. NatGasWeather reports that much of the Midwest, Plains, and Ohio Valley will remain in the 60s to low 80s through midweek.
This limits national gas demand, especially for cooling, and weakens the bullish case from weather-driven consumption. A hotter pattern is expected to emerge later in the week, but so far, it hasn’t been enough to counteract the weight of strong supply.
