Commodity Trading Tips for Natural gas by KediaCommodity

Natural gasNaturalgas settled up 2.89% at 295.90 rose after investors bet that a winter storm moving across the southern and eastern U. S. will hike demand for heating in the coming days. The U. S. National Weather Service reported earlier that parts of the southern U. S. may get 1 to 3 inches (2.5-7.5 centimeters) of snow and sleet over the next three days. Bullish speculators are betting that the winter storm will increase demand for the commodity at the country's thermal power plants as homes and businesses crank up their heating. Meanwhile, U. S. supply levels also remained in focus. Total U. S. natural gas storage fell by 262 billion cubic feet last week to 1.923 trillion cubic feet, approximately 22% below the five-year average for this time of year and nearly 29% below last year's unusually high level. Natural-gas inventories have fallen sharply since November as frigid winter temperatures in the U. S. led households to burn a higher than normal amount of the fuel in furnaces to heat their homes. Early withdrawal estimates for this week's storage data range from 225 billion cubic feet to 240 billion cubic feet. The five-year average change for the week is a decline of 162 billion cubic feet. Technically market is under short covering as market has witnessed drop in open interest by -2.68% to settled at 10197 while prices up 8.3 rupee, now Naturalgas is getting support at 288.3 and below same could see a test of 280.8 level, And resistance is now likely to be seen at 300.6, a move above could see prices testing 305.4.

Trading Ideas:

Naturalgas trading range for the day is 280.8-305.4.

Natural gas rose sharply as frigid winter temperatures and heavy snow was expected across the southern U. S. in the coming days.

Bullish speculators are betting that the winter storm will increase demand for the heating fuel.

Total U. S. natural gas storage fell by 262 bcf last week to 1.923 tcf, approximately 22% below the five-year average for this time of year