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Natural Gas may trade in range between 251.3-260.7
Commodity Online | November 09 2018
UPDATED 12:36:52 IST

MCX Silver may trade in a range between 36257-37017

Gold market under fresh selling; Support seen at 30715

MCX Mentha Oil under short covering

MCX Cotton under fresh buying; Resistance seen at 22380

MCX Cardamom under fresh buying; Support seen 1493.5

Technically Natural Gas market is under long liquidation as market has witnessed drop in open interest by 3.21% to settled at 7516 while prices down 0.4 rupees.

Now MCX Natural Gas is getting support at 254.2 and below same could see a test of 251.3 levels and resistance is now likely to be seen at 258.9, a move above could see prices testing 260.7.

Natural Gas on MCX settled down 0.16% at 257 while the prices where consolidated moving sideways forming a bull flag pattern which is a pause that refreshes higher. Prices were unaffected by a larger than expected build in natural gas inventories.

The weather is expected to be colder than normal over the next 6-10 days which should increase heating demand driving up the price of natural gas.  Natural gas stocks are less than last year and well below the five-year average range for this time of year.

Natural gas in storage was 3,208 Bcf as of Friday, November 2, 2018, according to EIA estimates. This represents a net increase of 65 Bcf from the previous week. Expectations were for a rise of 56 Bcf. Traders appear to be focused on the cold weather despite the larger than expected build.

This is because stock piles were 580 Bcf less than last year at this time and 621 Bcf below the five-year average of 3,829 Bcf. At 3,208 Bcf, total working gas is below the five-year historical range.

The trajectory of inventory builds are continuing to climb, but in the next couple of weeks, the withdrawal season will kick in and despite robust production, stockpiles will begin to fall.

The weather is expected to be much colder than normal over the next 6-10 days. While Cold air will pour down the Plains today, while also spreading across the Great Lakes and east-central US.

Trading Ideas:
--Natural gas trading range for the day is 251.3-260.7.
--Natural gas prices traded in range unaffected by a larger than expected build in natural gas inventories.
--The weather is expected to be colder than normal over the next 6-10 days which should increase heating demand driving up the price of natural gas.
--Natural gas in storage was 3,208 Bcf as of Friday, November 2, 2018, according to EIA estimates.

Courtesy: Kedia Commodities

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