MUMBAI (Commodity Online): MCX natural gas continues its high volatile price swings with the February contract down over 2% in afternoon trade on Monday. The contract opened lower at Rs 123.10 and is trading at Rs 120.90 as of 12:18 PM IST.
At the NYMEX, all active contracts are trading down. The fundamentals for the commodity are very weak on the back of a warm US weather and a huge supply glut.
Angel Commodities sees intra-day support at Rs 120.40 and Rs 122.10.
On a daily chart (shown below), nat gas does offer a chance of an upside move as prices are indicating a possible bottoming. If the Rs 114-Rs 115 levels can hold, and prices could rise to Rs 140 and a strong break above this level could indicate a price recovery.
Though fundamentally, it is still unclear what could trigger the move, some analysts do feel that the sell off has been overdone and prices are too low. Some producers have also began to cut back on production.
