Natural gas is gaining traction on its climb as price climbed past the mid-channel area of interest and is closing in on the resistance. Technical indicators suggest that bullish momentum is weakening, though.

The 100 SMA is above the 200 SMA for now, but the gap between the indicators has narrowed to show slowing upside pressure. A bearish crossover could draw sellers out and lead to declines for natural gas prices. Still, price is moving above both moving averages, so these could hold as dynamic support on dips.

Stochastic has already reached the overbought region and looks ready to move lower, reflecting a return in selling pressure. If that’s the case, natural gas could fall back to the middle of the channel or until the bottom near the $2.875 area.

RSI also appears ready to turn lower, although the oscillator has bit more room to climb before reflecting overbought conditions or exhaustion among buyers.

Commodities like natural gas are enjoying some upside pressure as gas shortages have been reported in several US states. This is mostly due to the cyberattack on a pipeline, as well as hoarding behavior in gasoline stations.

The upcoming report from the Department of Energy could show a slightly larger build of 74 Bcf versus the earlier increase of 60 Bcf, reflecting weaker demand for the commodity as temperatures have climbed. Then again, purchases could pick up as warmer weather sets in since natural gas can also be used for cooling, so a smaller build or a surprise draw might mean strong rallies for natural gas.

Risk aversion stemming from the stronger than expected inflation numbers from the US might keep a lid on commodity gains, though, as this could mean that the central bank and government might not need to provide more stimulus.