Technically Natural Gas market is getting support at 179.6 and below same could see a test of 178.4 levels and resistance is now likely to be seen at 182.5, a move above could see prices testing 184.2.
Naturalgas on MCX settled down 0.33% at 180.80 while prices were holding 180 levels as colder than normal weather is forecast to cover most of the United States over the next 8-14 days according to the National Oceanic Atmospheric Administration.
Inventories of natural gas remain below the 5-year average but above the 5-year average range. Colder than normal weather will increase heating demand, which should cap natural gas inventories.
A strong weather system and cold blast will track up the Mid-Atlantic Coast and into the Northeast the next few days with heavy rain, snow, and wind. This will result in stronger than normal demand as highs reach the 30s and 40s.
A break will follow Sunday through Tuesday as highs warm back into the 40s to 60s. The West will see a barrage of weather systems that bring heavy rain and snow, along with colder than normal temperatures. The southern US will be mostly mild to warm with highs of upper 50s to 70s.
Overall, demand will be high. Meanwhile, market participants looked ahead to this week's storage data due on Thursday, which is expected to show a draw in a range between 92 and 104bcf in the week ended March 9.
That compares with a decline of 57 bcf in the preceding week, a fall of 53 bcf a year earlier and a five-year average drop of 97 bcf. Total natural gas in storage currently stands at 1.625tcf, according to the U.S. Energy Information Administration.
--Natural gas trading range for the day is 178.4-184.2.
--Natural gas pared gains on profit booking after prices rose on expectations of colder-than-normal weather over the next two weeks.
--Inventories of natural gas remain below the 5-year average but above the 5-year average range.
--Meanwhile, market participants looked ahead to storage data due on Thursday, which is expected to show a draw in a range between 92 and 104bcf in the week
Courtesy: Kedia Commodities