Naturalgas settled down -2.73% at 324.50 turning lower as a round of profit taking kicked in after Natural gas futures rallied to the highest level since January 2010. The wildest movement of Rs. 36.10 seen in a single day but latter fell after longer-range weather predictions called for milder mercury readings to return after bitter cold temperatures currently gripping the eastern half of the country edge out. Updated weather forecasting models called for bitter cold weather across the U. S. during the next 3-5 days. Colder temperatures hike demand for natural gas at the country's thermal power plants as businesses and homes crank up their heating. Still, longer-range forecast models called for a return of seasonably mild temperatures to settle in across much of the country from Feb. 15 to Feb. 19, with some pockets of the country seeing above normal temperatures, which sparked a round of profit taking. Traders kept an eye out to Thursday's U. S. supply report as well. Early withdrawal estimates range from 250bcf to 281bcf, compared to a drop of 129bcf during the same week a year earlier. Total U. S. natural gas storage fell by 230bcf last week to 2.193tcf, approximately 17% below the five-year average for this time of year. Natural-gas inventories have fallen by nearly 40% since November as frigid winter temperatures in the U. S. led households to burn a higher than normal amount of the fuel in furnaces to heat their homes. Technically market is under long liquidation as market has witnessed drop in open interest by -13.73% to settled at 13838 while prices down -9.1 rupee, now Naturalgas is getting support at 311.4 and below same could see a test of 298.4 level, And resistance is now likely to be seen at 348.4, a move above could see prices testing 372.4.

Trading Ideas:

Naturalgas trading range for the day is 298.4-372.4.

Natural gas dropped due to longer term mild weather forecasts, while next-day prices spiked to record highs on anticipation for immediate cold.

Updated weather forecasting models called for severe cold weather across the U. S. during the next three-to-five days.

Bullish speculators are betting that colder weather will increase demand for the heating fuel.