It was a rough day for natural gas bulls after their attempted breakout yesterday, with the November natural gas contract plunging almost 4% today. 

The entire front of the futures strip saw major losses on the day as well, with losses not as bad March 2019 and beyond indicating a significant pricing out of the recent winter premium. 

Accordingly, the November/January contract barely moved on the day despite a major flat price decline. 

Some of this decline came before the Weekly Natural Gas Storage Report from the EIA, as traders anticipated a large injection to be announced and reacted to slightly weaker physical prices and slight GWDD losses overnight. The EIA then announced an in-line injection of 81 bcf, just 1 bcf away from our 82 bcf estimate. 

This marks 3 prints in a row that were significantly looser on a weather-adjusted basis than earlier prints in the year, indicating both the role of limited weather demand in the shoulder season as well as continued production growth. 

We had spent the bulk of the week warning subscribers that this print was likely to be quite loose, and therefore would likely have a bearish reaction. Even though the injection was 1 bcf below our estimate, prices only weakly bounced off the number and quickly continued selling off into the early afternoon, where warmer American guidance then compounded selling. We warned in our Morning Update that even with a bearish EIA print we would see $3.2 support holding on impressive GWDDs, though, as it attempted to into the settle. 

Our intraday Note similarly outlined short-term downside today to $3.2 but highlighted it would likely hold. Prices briefly broke below it, but settled right around it and bounced from there on colder European guidance as afternoon Climate Prediction Center forecasts showed more long-range cold risks as well. 

What is clear is that natural gas volatility is here to stay as weather model chaos has markedly increased and we continue to see storage levels far below average. Every day we publish a wide array of data and analysis for natural gas traders, from the latest historical contract spread breakdown to weather-adjusted power burns and production estimates as well as our custom 15-day GWDD forecasts and weather model discussions.