Natural Gas and the Seasonal Price Trend

There natural gas market has a definitive seasonal price trend that  is useful in helping to determine when to add forward coverage.

The chart above shows the seasonal price trend over the past three years (blue line) and five years (black line) in comparison to the current year (green line).

Over the past 3 and 5 years, the second and final seasonal low for the year is typically set during the months of August or September. 

This time period has also been one of the optimum opportunities to add to forward coverage in the market as most of the forward strips are trading at or near lows for the year.

Once the natural gas market does bottom on this current sell off (if it hasn't already), a seasonal rally back higher into the early months of 2015 should follow.

This should be the final opportunity to complete winter 14-15 coverage.