Commodity Trading Tips for Natural gas by KediaCommodity

Ajay Kumar Kedia 7 February 2014

Naturalgas settled down -4.78% at 309 edged lower on Thursday after a weekly U. S. supply report disappointed investors, who were hoping a recent string of powerful winter storms took their toll on the nation's stockpiles. The U. S. EIA said in its weekly report that natural gas storage in the U. S. in the week ended January 31 fell by 262bcf, missing expectations for a decline of 270bcf. Gas supplies fell by 129bcf during the same week a year earlier. Total U. S. natural gas storage stood at 1.923tcf. Stocks were 778bcf less than last year at this time and 556bcf below the five-year average of 2.479tcf for this time of year. The report showed that in the East Region, stocks were 312bcf below the five-year average, following net withdrawals of 143bcf. Stocks in the Producing Region were 187bcf below the five-year average of 889bcf after a net withdrawal of 93bcf. Traders were hoping below-normal temperatures gripping much of the U. S. last week would have taken more of a toll on the country's inventories. Updated weather forecasting models pressured prices lower as well. While bitter cold weather may linger across the U. S. during the next several days, seasonably mild temperatures should settle in across much of the country from Feb. 15 to Feb. 19, with some pockets of the country seeing above normal temperatures. Still, parts of the Midwest will see below-normal temperatures, which curbed the commodity's losses. Technically market is under long liquidation as market has witnessed drop in open interest by -14.79% to settled at 11791 while prices down -15.5 rupee, now Naturalgas is getting support at 298.2 and below same could see a test of 287.4 level, And resistance is now likely to be seen at 328.6, a move above could see prices testing 348.2.