Natural Gas yesterday traded with the positive node and settled 3.31% up at 159 backed by incremental demand from several unexpected nuclear plant outages coupled with technical buying and short-covering. Market players continued to monitor weather forecasts for the rest of August to gauge the strength of future demand expectations for the fuel, as well as tropical storm activity in the Gulf of Mexico. Industry weather group MDA EarthSat said earlier that "seasonally cool" temperatures are expected for much of the U.S. over the next ten days, with only "minor warming trends" through the end of August. Cooler summer temperatures reduce the need for gas-fired electricity to power air conditioning, dampening demand for natural gas. Concerns over bloated U.S. inventory levels have also dampened the appeal of the commodity. Total U.S. gas supplies stood at 3.241 trillion cubic feet last week, 16.8% above last year’s level and 13.5% above the five-year average level for the week. Early injection estimates for this week’s storage data range from 25 billion cubic feet to 40 billion cubic feet, compared to last year's build of 43 billion cubic feet. The five-year average change for the week is an increase of 43 billion cubic feet. The tumble in recent weeks comes as investors prepare for the last few weeks of summer in the U.S., which typically mark the end of a period of high gas usage. In yesterday's trading session natural gas has touched the low of 152.5 after opening at 153.6, and finally settled at 159. For today's session market is looking to take support at 154.5, a break below could see a test of 149.9 and where as resistance is now likely to be seen at 161.6, a move above could see prices testing 164.1.
Trading Ideas:
Nat.Gas trading range for the day is 149.93-164.13.
Natural gas ended higher backed by increase in demand coupled with technical buying and short-covering
The tumble in recent weeks comes as investors prepare for the last few weeks of summer in the U.S
Today natural gas storage: EXP: 25B PREV: 24B. Actual is at 8.00PM
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