Naturalgas on MCX settled up 3.81% at 231.60 extended sharp gains once again prices climbed to a more than one-week high after data showed that natural gas supplies in storage in the U.S. fell more than expected last week. Support seen after the US EIA said in its weekly report that natural gas storage in the U.S. declined by 151bcf in the week ended January 6, exceeding market expectations for a drop of 144bcf. That compared with a withdrawal of 49bcf in the preceding week, 168 billion a year earlier and a five-year average drop of 167bcf. Total natural gas in storage currently stands at 3.160tcf, according to the US EIA, 10.3% lower than levels at this time a year ago and around 0.1% below the five-year average for this time of year. Meanwhile, updated weather forecasts for the end of January turned colder, which should boost demand for the heating fuel. Weather models initially predicted mild temperatures throughout most parts of the U.S. during the period. Natural-gas markets have been volatile in recent weeks, changing course rapidly in response to shifting outlooks in short-term weather patterns. Technically market is under short covering as market has witnessed drop in open interest by -18.92% to settled at 3385 while prices up 8.5 rupee, now Naturalgas is getting support at 225.3 and below same could see a test of 218.9 level, And resistance is now likely to be seen at 236.5, a move above could see prices testing 241.3.

Trading Ideas:

Naturalgas trading range for the day is 218.9-241.3.

Naturalgas rallied as support seen after data showed that supplies in storage in the U.S. fell more than expected last week.

EIA said in its weekly report that natural gas storage in the US declined by 151bcf in the week ended January 6

Temporary blasts of cold have produced big boosts in demand in recent weeks, and there is still plenty of time for the weather to shift