Technically Natural Gas market is under fresh buying as market has witnessed gain in open interest by 9.51% to settled at 4087 while prices up 1.5 rupees.
Now MCX Natural Gas is getting support at 197.9 and below same could see a test of 195.8 levels and resistance is now likely to be seen at 201.8, a move above could see prices testing 203.6.
Natural Gas on MCX settled up 0.76% at 200 gained on fresh buying despite warmer than normal weather is expected to cover most of the United States for the next 8-14 days which foreshadows the need for additional cooling demand which could increase natural gas demand.
A hot upper ridge will dominate the central and southern US this week with highs of upper 80s to 100s for strong demand. The northern US will see numerous weather systems track across with showers and slightly cool versus normal conditions with highs mainly in the 60s to 80s for light heating and cooling demand.
A warm break will spread across the northern and eastern US this weekend into next week for stronger demand. The West will be heating up this week with highs mainly in the 80s to 100s, then cooling this weekend. Demand remains strong. Total products demand over the last month averaged more than 20.4 million barrels per day, up by 1.7% from the same period last year.
Over the past month, gasoline demand averaged about 9.6 million barrels per day, up by 0.3% from the same period last year. Distillate fuel demand averaged 4.0 million barrels per day over the past four weeks, down by 0.5% from the same period last year. Meanwhile, market participants looked ahead to this week's storage data due on Thursday.
--Natural Gas trading range for the day is 195.8-203.6.
--Natural gas gained concerns storage builds will not be high enough to return stockpiles to near normal levels before next winter despite record-high production.
--Prices increased despite forecasts for weaker demand next week than previously expected.
--Meteorologists have predicted temperatures would remain at above normal levels through at least the end of June.
Courtesy: Kedia Commodities