The natural gas market on the Nymex faced another negative week. Friday’s session closed 8% lower than the previous one, at $3.04. The EIA weekly storage report confirmed only a 20 Bcf withdrawal, yet the price moved higher, which indicates that we might have found a floor for the season. A movement inside a range-bound between $2.80 and $4.00 might be the case for the coming weeks, while winter is still on, although domestic demand will not be picking up for another week, as the weather will remain milder than normal across the Lower 48. LNG infrastructure works in the Gulf and export approvals, as well as coming week’s talks between U.S. and China trade negotiations, have to be closely monitored.
We prefer to sell rallies on exhaustion and we might have to wait to fill the gap around $3.60. We will not buy this market for a longer period. Not before Daily MACD crosses bullish. RSI is looking neutral while range-bound movements, as market participants show patience, are very probable. We still need to keep an eye on dollar against majors, oil to gas ratio and trading volumes.
Natural Gas USD
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