Commodity Trading Tips for Natural Gas by KediaCommodity

Ajay Kumar Kedia 28 July 2014

Natural-Gas Naturalgas settled down -1.8% at 228.7 after updated weather-forecasting models called for mild temperatures to hover over portions of the heavily populated eastern half of the U.S. in the coming days. Forecasts for below-normal temperatures sent natural gas prices falling on Friday as investors sold on expectations for households to throttle back on their air conditioning. In its Friday mid-day update, Natgasweather.com reported that cool snaps are expected this weekend and next week that will bring below-normal temperatures to much of the central and eastern U.S. "This guarantees two more much larger than normal builds to come. A much warmer pattern will begin to set up after next week, but it will still be fairly active with areas of showers and thunderstorms over much of the U.S.," Natgasweather.com reported. The bearish weather report wiped out gains stemming from Thursday's bullish weekly inventory report. The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended July 18 rose by 90 billion cubic feet, below expectations for an increase of 96 billion cubic feet. The five-year average change for the week is an increase of 46 billion cubic feet. Total U.S. natural gas storage stood at 2.219 trillion cubic feet. Stocks were 561 billion cubic feet less than last year at this time and 683 billion cubic feet below the five-year average of 2.902 trillion cubic feet for this time of year. Technically market is under fresh selling as market has witnessed gain in open interest by 40.72% to settled at 5253 while prices down -4.2 rupee, now Naturalgas is getting support at 226.3 and below same could see a test of 223.8 level, And resistance is now likely to be seen at 232.6, a move above could see prices testing 236.4.