Natural Gas at session's high as US jobless data shows resilient US labor force

• Natural Gas price soars near $3.20.
• The US Dollar firms up after weekly US jobless data.
• US Natural Gas prices could head higher on the possibility of a cold front coming in sooner than expected. 

Natural Gas prices are flirting with a fresh 8-month high as several weather forecast models point to a sharp drop in temperatures in Europe over the coming weeks. Traders focus on this potential cold front to come in sooner than expected. It looks like the current grace period for European gas consumption will not be that long and that by the end of this month households will jack up their thermostats. 

The US Dollar (USD) turns firm again after weekly US jobless data comes in strong again. The numbers from Wednesday are becoming yesterday's news. This puts the US Dollarindex (DXY) back to square one ahead of the always important US jobs report coming Friday. 

Natural Gas is trading at $3.20 per MMBtu at the time of writing.  

Natural Gas news and market movers

• European storage sites are reporting another hike in reserves to 96.33%. 
• Fuel shipments from Norway, the top gas supplier for the EU, are recovering and are set to hit the highest level since August once the last gas fields are fully back online. 
• The most recent weather models show a substantial drop in temperatures by mid-October in Europe, which means that the current higher-than-normal temperatures aren’t expected to last long.
• Meanwhile in Australia, Chevron has reneged on the commitment it gave to the Fair Work Commission and could dent the current agreement in place in order to dissolve the strikes in Wheatstone and Gorgon LNG facilities. Union workers are set to reconvene on Thursday to discuss a possible restart of strikes. 
• Turkey’s Energy Minister Alparslan Bayraktar says he will travel to Israel in November to meet his counterpart and energy companies operating in the gas industry. Turkey wants to develop a framework with Israel when it comes to energy. Turkey would buy natural gas from Israel for domestic use and would also send a fraction to the European market.
• In all these headlines, one would almost forget that near 14:30 GMT the weekly Energy Information Administration (EIA) Natural Gas Storage Change for the last week of September is due. Expectations are for another build from 90 to 92 Billion cubic feet.

Natural Gas Technical Analysis: flirt with $3.20

Natural Gas is soaring higher this week, with traders ignoring the higher temperatures in Europe and rather focusing on the cold front coming in. Traders are presuming that the EU will want to keep its gas reserves filled to the brim, and will buy at any time. With this prepositioning, a quick squeeze higher in the coming weeks could materialise. 

The pivotal level near $3.07 has been broken again to the upside. This level needs to hold now as a new floor, squeezing prices higher. With respect of the ascending trend channel, the upside looks limited toward $3.30 to test the upper barrier. 

On the downside, the newly formed floor at $3.07 should act as support together with the psychological $3 big figure. In case demand abates further, or more supply out of Norway comes back online, expect to see an initial drop back to the green ascending trendline near $2.95. Should that give way, $2.80 is an area with two moving averages (the 55-day and the 100-day) and the lower barrier of the trend channel that could encourage bulls to catch any falling price action. 

XNG/USD (Daily Chart)