Natural gas price steadies near $3.38 as Europe heatwave and U.S. rebound test resistance
Natural gas trades near $3.38 amid extreme weather in Europe and cautious rebound in U.S. futures
Natural gas futures traded around $3.38 on Friday, attempting a short-term recovery after a recent correction that pushed prices down to the $3.16 zone. Bulls are defending the $3.20 support level, with price action on the daily chart suggesting a cautious shift in momentum.
Highlights
- Natural gas trades around $3.38, recovering from a recent low near $3.16
- European prices hit €35/MWh amid heatwave and flexible gas storage rules
- Resistance remains strong at $3.60; breakout needed for further upside
However, broader structure remains bearish unless buyers can decisively reclaim key resistance above $3.60.
In Europe, gas prices jumped to €35 per megawatt-hour, their highest level in two weeks, supported by forecasts for warmer-than-usual temperatures and stable regional supply. Western Europe just recorded its hottest June on record, and upcoming heatwaves are likely to boost demand for cooling. The European Parliament has also granted member states flexibility on gas storage targets, allowing more time to reach the 90% storage threshold by December. This move reduces the risk of summer price shocks despite rising temperatures.
Technical outlook signals short-term recovery
Technically, the U.S. natural gas price is rebounding from the $3.20–3.25 support area, with the recent low of $3.16 forming a local base. However, the price remains below the descending trendline from the $4.15 high, and overhead resistance near $3.58–3.60 remains intact. A break above this zone could open the path toward $3.80.
NG price dynamics (Source: TradingView)
EMA clusters between $3.32 and $3.46 present immediate resistance. The 4-hour Bollinger Bands are tightening, with price testing the upper band at $3.45. A sustained close above this level would confirm bullish momentum, though recent attempts have stalled.
RSI on the 30-minute chart is at 60.9, reflecting improving sentiment, while MACD has turned positive. Despite this, higher timeframe indicators remain neutral, underscoring the need for confirmation before a broader trend shift is declared.
Policy and weather risks shape the next move
TotalEnergies CEO said Europe will no longer depend on Russian LNG by 2028, citing new capacity from the U.S. and Qatar. However, he cautioned that expanding U.S. tariffs under President Trump could strain global trade and growth. For now, weather remains the primary near-term catalyst, with extreme heat likely to lift short-term demand.
Previously, we highlighted that natural gas price action would remain volatile near the $3.20–3.60 range. The latest rebound aligns with that expectation, but a breakout above $3.60 is needed for sustained upside. Until then, price may oscillate within the current band.
