Commodity Trading Tips for Natural Gas by KediaCommodity

Ajay Kumar Kedia 12 June 2014

Natural-Gas Naturalgas settled at 269.30 held near a two-week low struck in the previous session on Wednesday, as market players assessed the outlook for U.S. demand and supply levels. Natural gas futures have been under pressure in recent sessions as mild weather forecasts weighed on near-term demand expectations for the fuel. Updated weather-forecasting models showed that the Midwest and Texas would see cooler-than-average temperatures over the next five days, while the East and West coasts would experience warmer than normal conditions. Demand for natural gas tends to rise in the summer months as warmer temperatures increase the need for gas-fired electricity to power air conditioning. Meanwhile, market players continued to assess the outlook for U.S. supply levels. Utilities added 119bcf of gas into storage last week, the largest weekly injection since 2009. Total U.S. natural gas storage stood at 1.499tcf as of last week, nearly 33% below their level this time last year and 37% below the five-year average. Producers would need to add approximately 2.5tcf to storage by November 1 to meet typical winter demand. Meanwhile, market players continued to assess the outlook for U.S. supply levels. Utilities added 119bcf of gas into storage last week, the largest weekly injection since 2009. Total U.S. natural gas storage stood at 1.499tcf as of last week, nearly 33% below their level this time last year and 37% below the five-year average. Producers would need to add approximately 2.5tcf to storage by November 1 to meet typical winter demand. Technically market is under long liquidation and getting support at 267.7 and below same could see a test of 266.2 level, And resistance is now likely to be seen at 271.2, a move above could see prices testing 273.2.