Commodity Trading Tips for Natural gas by KediaCommodity

Ajay Kumar Kedia 16 April 2013

Natural gas settled -1.82% down at 226.90 after investors sold the commodity for profits despite forecasts for wintry weather and below-normal temperatures to settle in for much of the central US. Natural gas prices rose late last week on forecasts for a return of colder-than-normal temperatures for the heavily populated eastern half of the U. S., though by Monday, investors sold and locked in profits, especially as fears of a global economic slowdown roiled markets worldwide. Supply data released Thursday confirmed many suspicions that supplies are tight due to repeated waves of cold snaps sweeping across the U. S. in late winter and early spring, though profit-taking kept prices lower Monday afternoon. The U. S. EIA said in its weekly report on Thursday that natural gas storage in the U. S. in the week ended April 5 fell by 14bcf, compared to expectations for a drop of 13bcf. Inventories increased by 11bcf in the same week a year earlier, while the five-year average change for the week is a build of 15bcf. Total U. S. natural gas storage stood at 1.673tcf as of last week. Stocks were 804bcf less than last year at this time and 66bcf below the five-year average of 1.739tcf for this time of year. The report showed that in the East Region, stocks were 92bcf below the five-year average, following net withdrawals of 16bcf. In yesterday's trading session natural gas has touched the low of 225.8 after opening at 231.9, and finally settled at 226.9. For today's session market is looking to take support at 223.7, a break below could see a test of 220.4 and where as resistance is now likely to be seen at 232.3, a move above could see prices testing 237.6.