Commodity Trading Tips for Natural Gas by KediaCommodity

Ajay Kumar Kedia 17 January 2014

Natural-Gas Naturalgas settled down -0.48% at 269.20 given up all it's earlier gain as weather forecasts called for reinforcing blasts of cold air to trek east across the U.S. and hike demand for heating in the nation's homes and businesses, while supply data capped gains albeit slightly. A blast of cold air shooting across the country, including in the southeastern U.S., will see reinforcing chilly air masses follow suit, which sent natural gas prices rising on Thursday. Natgasweather.com reported that temperatures will largely remain on the cooler side for the rest of the month, which also supported the commodity. Weekly inventory data capped gains. While a recent freeze took its toll on inventories, markets were hoping for a bigger draw. The U.S. EIA said in its weekly report that natural gas storage in the U.S. in the week ended January 10 fell by 287bcf, the largest drop on record though still below expectations for a decline of 301bcf. The five-year average change for the week is a decline of 159bcf. The previous record drop was a decrease of 285bcf in the seven days ended December 13, EIA data show. Total U.S. natural gas storage stood at 2.530 trillion cubic feet. Stocks were 659bcf less than last year at this time and 443bcf below the five-year average of 2.973 trillion cubic feet for this time of year. The report showed that in the East Region, stocks were 292bcf below the five-year average, following net withdrawals of 149bcf. Stocks in the Producing Region were 104bcf below the five-year average of 1.016bcf after a net withdrawal of 107bcf. Technically market is getting support at 265.3 and below same could see a test of 261.5 level, And resistance is now likely to be seen at 274.8, a move above could see prices testing 280.5.