Natural Gas Price Forecast: NG=F Clings to $4.12 Support After Weather Shock

Natural Gas (NG=F) Trades Near $4.12 As Weather Shock Collides With Tightening Fundamentals

From $5.50 Spike To $4.12: Volatility Around Winter Repricing For NG=F

Natural Gas (NG=F) Short-Term Price Structure And Recent Collapse
Front-month NG=F has reversed sharply from an early-December spike above $5.50/MMBtu to trade near $4.12, down roughly 2.6% on the day and sitting at a seven-week low around $4.231 at Thursday’s close. A single session decline of 36.4 cents, or 7.9%, followed a 177 Bcf storage withdrawal that would normally be bullish, showing how aggressively the market is repricing late-December demand. The January contract dropped from an intraday high near $5.496 to $4.455, a $1.041 implosion in a few days, then slid again to the $4.231–$4.12 zone. Price has broken below the 20-, 50-, 100- and 200-day moving averages, confirming a momentum break rather than a shallow pullback.

Weather-Driven Demand Shock: gHDD And Bcf/day Losses Pressure NG=F
The dominant driver of the selloff is a brutal collapse in late-December heating demand. Week 3 of December has shed about 42 gHDD since last Friday in earlier model runs, and the week into Christmas has lost another 7 gHDD in the last 24 hours. What had looked like a cold finish to 2025 flipped into a “blowtorch” pattern for much of the Lower 48. Week-over-week demand into Week 3 is now projected to drop roughly 9.5 Bcf/d, while updated forecasts show daily demand surging into a cold peak this weekend, then plunging about 25–26 Bcf/d into mid-next week. That 116 Bcf collapse in expected demand since Friday has outweighed a strong storage draw and triggered systematic selling in NG=F futures and physical hubs.

EIA Storage Draw Of 177 Bcf: Bullish Print Ignored By NYMEX NG=F Futures
The latest EIA report shows working gas in storage at 3,746 Bcf for the week ending December 5, a net 177 Bcf withdrawal. Stocks now stand 28 Bcf below last year and 103 Bcf above the five-year average of 3,643 Bcf, still within the historical range. A 177 Bcf pull is a strong early-season draw and typically would support NG=F, especially with the first major linepack effects of winter. Consensus expectations sat around 165–174 Bcf, so the actual number leaned modestly bullish. The problem is not the current week but the forward path. Markets are focused on the 133 Bcf loss of weather-driven demand for the upcoming period and on model runs that keep shaving heating need, so the storage beat is being discounted.

Regional Storage For Natural Gas And East-Coast Tightness
Regionally, the East is already tightening. Stocks there are about 2.1% below the five-year average after a 45 Bcf regional withdrawal. Midwest inventories are also described as relatively lean, even as the Lower 48 total still carries a 2.8% surplus versus normal. Forward curves for key eastern hubs show sharp winter premium spikes in early 2026 and 2027, while summer basis stays flatter. That structure implies the market expects recurring winter tightness despite the current weather-driven collapse in prompt-month NG=F.

Medium-Term Outlook: EIA Expects 580 Bcf December Draw And $4.30 Henry Hub
Despite the current correction, medium-term fundamentals are firming. One major outlook projects December will deliver the highest U.S. heating demand of any December in 15 years, even after the late-month warm shift. The EIA has raised its November–March Henry Hub spot price forecast by 13% month on month to about $4.30/MMBtu. It also expects roughly 580 Bcf withdrawn from storage in December alone, about 28% above the five-year average monthly draw. If that path holds, the longstanding storage surplus is likely to flip toward a deficit as the market enters early 2026, a structurally bullish backdrop for NG=F once the current weather shock is absorbed.

Production, LNG Feed Gas And Structural Demand For Natural Gas
The selloff is not being driven by a supply glut. Production readings are described as declining or flattening rather than surging, while U.S. LNG feed gas demand is sitting at record or near-record highs. Weekly average LNG loadings are at new peaks, and exports to Mexico via pipeline continue to trend toward record volumes. That means a large share of incremental U.S. gas is being pulled off the domestic grid into export channels just as winter demand lifts. This combination of high export demand, softer production and a storage surplus that is shrinking rather than expanding makes the fundamental picture for Natural Gas more supportive than the price chart implies.

Technical Map For NG=F: Key Moving Averages, Support And Resistance
Technically, NG=F has broken below all major trend-following averages. Price is now under the 20-day, 50-day, 100-day and 200-day moving averages, which confirms a bearish momentum phase. The 50-day EMA clusters around $4.20, forming a first support band together with the prior horizontal floor at $4.20–$4.23. Below that, multiple analyses define a broader support zone stretching down to about $4.00, with some channel support identified near $3.95. On the upside, a rebound above roughly $4.40 would be the first sign that momentum is flipping back in favor of the bulls. Above $4.40, the next textbook upside objective sits near $5.00, followed by the recent spike zone above $5.50 if winter weather turns sharply colder again.

Economies.com View: Corrective Bearish Wave Inside A Larger Bullish Trend For Natural Gas
One technical framework describes the recent decline in Natural Gas as a “bearish corrective attack” within a still-bullish broader structure. In that view, $4.200 is flagged as “extra support,” and holding above it would allow NG=F to start a new bullish wave, targeting $4.550 first and then the 38.2% Fibonacci correction level around $4.750. A break below $4.200 would ease the move toward the rising channel support near $3.950, shifting the setup toward a deeper negative scenario. The expected intraday trading band is framed between $4.200 and $4.550, with the trend forecast still labeled “bullish” as long as the channel structure remains intact.

FXEmpire View: Seasonal Tailwind Supports A Buy-The-Dip Bias In NG=F
Another desk emphasizes the seasonality behind NG=F around year end. December and January are statistically strong months for natural gas because U.S. and European heating demand typically peaks. This perspective notes price “hanging around” the 50-day EMA near $4.20, marking that level as a key technical pivot. A “zone of support” is identified from $4.20 down to $4.00, with traders looking for signs of stabilizing momentum before adding long exposure. A clean break above $4.40 is seen as confirmation that the market is ready to re-test $5.00. Under $4.00, that bullish thesis is invalidated, and a more decisive unwinding of winter premium would likely follow. Importantly, this view stresses that another round of cold warnings has already been issued for the U.S. and Europe, which could quickly flip sentiment again in favor of Natural Gas if the models stop shedding gHDD.

Short-Term Sentiment: Futures Rout, Forwards Crushed, Relief Rally Still Missing
Short-term sentiment for NG=F is fragile. Futures have been described as “in freefall” over several sessions, with attempts at intraday relief rallies limited to bounces of 2–3 cents after collapses of 70–100 cents earlier in the week. Forwards along the curve have also been “crushed” as warmer December forecasts hit winter strip pricing, even though later-dated winter 2026–2027 basis still carries a premium. The lack of a more meaningful relief rally after a 71.5-cent early-week collapse is flagged as a caution sign, indicating that dip buyers are still hesitant to step in aggressively until weather models stabilize. Traders are watching for short-covering into the weekend, but so far price action suggests that momentum funds are still in control on the sell side.

Storage Path And NG=F Risk Balance Into Early 2026
The storage trajectory is central to the Natural Gas thesis. The latest 177 Bcf draw and expectations for a 580 Bcf December withdrawal together imply that the long-running surplus versus the five-year average will narrow rapidly and could flip into a deficit as early as the first quarter of 2026. East region inventories already sit 2.1% below normal, and a cold January would likely deepen that shortfall. At the same time, the Lower 48 still shows a 2.8% surplus for now, giving the market some buffer to absorb a patch of warm weather. If late-December stays anomalously mild and January fails to deliver the projected 15-year high for heating demand, NG=F could spend more time pressing the $4.00–$3.95 floor. If instead the forecast swings back toward sustained cold, the combination of tighter storage, high LNG exports and soft production could very quickly push Natural Gas back through $4.40 toward $5.00.

Macro Context: Winter Demand, Power Burn And Price Elasticity For Natural Gas
Macro influences on NG=F extend beyond household heating. Power-sector gas burn remains structurally high as coal retirements continue, meaning that even shoulder-season demand does not collapse the way it did a decade ago. Data center growth and industrial gas usage add further stickiness to baseline demand. On the supply side, producers are weighing how to respond to the recent spike above $5.50 and the subsequent correction. Futures near $4.12–$4.30 into winter are still nearly double last year’s entry level, improving cash flow even after the selloff. The core strategic question for producers is whether this is a one-off weather spike or the start of a higher-priced regime for Natural Gas in 2026 and beyond. Given the EIA’s raised Henry Hub outlook, record LNG demand and recurring winter basis spikes in the East, the forward curve is signaling that elevated pricing is more feature than bug, even if the prompt month is temporarily depressed by model volatility.

Trading Stance On Natural Gas (NG=F): Hold With A Cautiously Bullish Bias
Pulling the strands together, Natural Gas (NG=F) is sitting at the intersection of bearish short-term weather and increasingly bullish structural fundamentals. On the negative side, late-December gHDD losses of 40+ units, daily demand drops of 25–26 Bcf/d, and a $1.00+ collapse from the early-December high have smashed sentiment and pushed price below every major moving average. On the positive side, storage just delivered a 177 Bcf draw, December withdrawals are projected near 580 Bcf, East region inventories are 2.1% below average, LNG feed gas is at records, production is flattening, and winter seasonality still favors higher NG=F pricing if cold weather reasserts itself. With spot near $4.12, key support at $4.20–$4.00, upside triggers at $4.40, and a medium-term fair value signal around $4.30+, the data supports a Hold stance with a cautiously bullish directional bias. Aggressive buying is only justified on a confirmed rebound above $4.40 or a renewed cold shift in the models, while a decisive break below $4.00 would downgrade the view toward short-term bearish despite still-constructive fundamentals into 2026.

That's TradingNEWS