After tagging a high of $4.688 on Thursday, the December contract is now testing the 200-day MA near $4.455. That level is drawing heavy interest, with short-term sentiment hinging on how the market reacts to it post-EIA release. A bullish storage print could flip sentiment quickly and spark a retest of $4.688, with $4.717 — a multi-month top — just above that.
But traders aren’t chasing the bounce — not yet. The overnight pullback reflects profit-taking and doubt creeping back into the weather narrative. Early cold forecasts helped spark yesterday’s pop, but revisions are adding warmth back into the outlook, trimming heating degree days and prompting longs to step aside — at least for now.
What’s the Market Expecting from the EIA?
Consensus is calling for a +34 Bcf build for the week ending November 7, right in line with the five-year average. Last week’s report came in at +33 Bcf, also near consensus but below the five-year norm. Storage remains more than adequate, sitting +4.3% above its five-year average as of October 31.
European gas storage is another piece of the puzzle — sitting at 82% full, but still trailing the 91% five-year norm. It’s not a crisis, but it keeps a floor under global LNG demand, especially if winter arrives late but strong.
Weather Outlook: Mild Now, But Cold Lurks?
The near-term forecast leans bearish — plenty of mild air and light demand through Sunday, with only a brief bump early next week. Most models show warm conditions across the northern U.S., with highs ranging from the 40s to 60s. That’s not what bulls want to see this time of year.
Still, traders are watching for a colder setup building into late November and early December. A pattern shift around November 26–29 could be the next catalyst. If the frost hits hard, there’s still fuel for another leg higher.
