Natural gas is trending lower on its 1-hour chart, moving inside a descending channel and testing the resistance. If this holds, price could fall back to the nearby support levels.

The mid-channel area of interest recently held as a floor around the $2.450 mark, but a stronger selloff could take it to the channel support closer to $2.300.

The 100 SMA is below the 200 SMA to indicate that the path of least resistance is to the downside or that the selloff is more likely to resume than to reverse. The 100 SMA is also near the channel top around $2.500 to add to its strength as a ceiling.

Stochastic is heading higher to show that bullish pressure is still present, though, so price could still attempt to break out of the channel and start a reversal. RSI is also heading up but is stalling on middle ground to reflect consolidation. Turning back down could confirm a return in selling momentum.

Natural gas could be on weak footing as the latest inventory report revealed a smaller than expected draw of 11 Bcf compared to the estimated reduction of 21 Bcf and the earlier drop of 52 Bcf.

This suggests that demand may have been weaker than expected or that supply has picked up significantly following the reopening of production facilities that were shut down temporarily during the winter storms.

Weather forecasts could determine where natural gas prices are headed from here, with warmer than usual temperatures likely to keep a lid on purchases of heating commodities. Forecasts of cooler weather could mean stronger demand for natural gas, which might boost prices.

Risk appetite would likely impact commodity price action as well, as a pickup in demand for higher-yielding assets might mean more gains for natural gas. On the other hand, preference for safe-haven holdings could spur more losses.