Commodity Trading Tips for Natural Gas by KediaCommodity

Ajay Kumar Kedia 24 July 2014

Natural-Gas Naturalgas settled down -0.96% at 226.70 after updated weather-forecasting models called for cooler temperatures across most parts of the heavily-populated Midwest and Northeast regions over the next ten days. Demand for natural gas tends to fluctuate in the summer based on hot weather and air conditioning use. Meanwhile, investors readjusted positions ahead of Thursday’s closely-watched supply report to gauge the strength of cooling demand. This weekly’s supply data was expected to show that natural gas storage in the U.S. rose by 95 billion cubic feet in the week ended July 18. Total U.S. natural gas storage stood at 2.129 trillion cubic feet as of last week, narrowing the deficit to the five-year average to 25.5%, down from a record 54.7% at the end of March. Injections of gas into storage have surpassed the five-year average for 13 consecutive weeks. Lastweek Natural gas plunged close to a six-month low in the second part of the week as the EIA report showed inventories jumped more than predicted. U.S. stocks climbed 107 billion cubic feet in the week ended July 11 versus an estimate of a 99-billion-cubic-feet rise and a previous week’s reading of an increase of 93 billion cubic feet. However, total storage still stood near 2.129 trillion cubic feet, remaining under the five year average of 2.856 trillion cubic feet. Weather forecasts were on the negative side, calling for a cool snap in the most populated areas in the Midwest and Northeast. Technically market is under long liquidation as market has witnessed drop in open interest by -3.19% to settled at 8154, now Naturalgas is getting support at 225.4 and below same could see a test of 224.2 level, And resistance is now likely to be seen at 228.6, a move above could see prices testing 230.6.