The price of natural gas has historically tended to rise and fall with the seasons along with demand for the fuel. It’s main use is in home heating so it tends to see its strongest demand in the wintertime and its weakest demand in spring and fall. Natural gas had a big rally in the fall of last year that carried into the winter as heating season got underway. Since February, natgas has been retreating, losing nearly half its value in a typical seasonal selloff. In the last month, technical and fundamental indicators have combined to suggest the seasonal retreat may be over and a seasonal rebound potentially poised to start. In the last month, Natural gas has stabilized in the $3.70 to $4.00 range similar to levels it was trading at in the summer of 2013. RSI had become deeply oversold by July and a positive divergence emerged that suggested downward pressure was slowing. Over the last few weeks momentum has been turning increasingly upward, confirmed by the RSI breaking out of a downtrend and back above 50 recently. A break by the natural gas price through $4.00 would signal the start of a new seasonal uptrend that could test a measured $4.30 initially with tests of $4.38 (23% retracement or the previous downtrend) or $4.75 (38% retracement) possible as winter approaches again. Fundamentals also suggest the potential for a rebound in the gas price. During last home heating season (Nov 1-Mar 31), 3,257 BCF of Natural gas was drawn from storage. Since April 1st only 1,808 BCF has been replaced. In May and June the average storage build was 105 BCF a week. In July and August only one out of 8 weeks has been above 100BCF and the average has been 87 BCF. To fully replenish last year’s drawdown 161 BCF a week would need to be added to storage through September and October which appears unlikely considering that last year only 73 BCF a week was added over the same time frame. Based on this it appears we may head into the winter with less gas in storage than last year, so supply conditions appear to be supportive, making the weather and its impact on demand the key variable factor this winter.