Natural gas yesterday traded with the negative node and settled -0.16% down at 128.2 dropped again as forecasts of nonstop mild winter weather in the US dampened sentiment on the heating fuel ahead of report on US Natural Gas supplies.
Selling pressure seen mounting after the CWG said warmer than normal temperature was forecast for the next 2weeks across most parts of the US.
According to the firm, temperatures in the Northeast may be 8 degrees above normal throughout the period. Weather service provider AccuWeather offered a similar outlook.
The company expects temperatures in the US Northeast and Midwest to mostly average above normal for the next 5days. Meanwhile, natural gas traders were looking forward to US EIA’s report on US natural gas stockpiles for the week ended Feb 10 to gauge the strength of demand in the U.S.
The data could show a decline of 146bcf, compared to last year's drop of 102bcf and the five-year average decline for the week of 145 billion.
With high levels of production continuing across the US, only a prolonged period of frigid weather in the last six weeks of winter is likely to reduce stockpile levels and raise prices.
Inventory withdrawals this winter are running nearly 530bcf below average, or about 33%, due to the lack of heating demand this winter.
For today's session market is looking to take support at 126.2, a break below could see a test of 124.2 and where as resistance is now likely to be seen at 130.1, a move above could see prices testing 132.
Trading Ideas:
Nat.Gas trading range for the day is 124.2-132.
Natural gas prices dropped again as forecasts of nonstop mild winter weather in the US dampened sentiment.
Prices came under selling pressure after the CWG said warmer-than-normal temperature was forecast for the next 2weeks.
Today Natural Gas storage: EXP: -146B PREV: -127B.Actual is at 9.00PM.
Courtesy: Kedia Commodities
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