Weighed down by weak shoulder season fundamentals, natural gas futures added to their losses in early trading Monday. After sliding 10.8 cents on Friday, the November Nymex contract was off another 23.4 cents to $6.532/MMBtu as of around 8:40 a.m. ET.
From a technical standpoint, prices held above a “dense cluster of support candidates” from $6.600 down to $6.220 in intraday trading and finished above $6.744 to close out Friday’s session, ICAP Technical Analysis analyst Brian LaRose said.
The bulls face a problem, however, in that they “can not seem to find their footing, and they need to do more than just prevent natural gas from selling off,” LaRose said. “If they can not, a more substantial test of the $6.600-6.220 zone, even a drop to $5.730-5.713-5.689 is possible from here.”
EBW Analytics Group senior analyst Eli Rubin highlighted the “extremely weak” prices in the physical market to close out last week.
“While demand was particularly weak with Hurricane Ian, Cove Point LNG offline, and weather-driven demand at a seasonal nadir, the soft market is indicative of further downside risks,” Rubin said.
This comes as pipeline scrapes indicate domestic dry gas production “roared higher” to kick off the new month, a development that puts additional downward pressure on prices, according to Rubin.
“November’s 200-day moving average at $6.57 represents a key inflection point,” Rubin said. “While gas storage is low on an absolute basis, growing near-term bearish catalysts may reduce odds for a bounce higher and favor further declines for Nymex gas futures.”
As for the latest weather outlook, NatGasWeather observed only minor changes to the forecast over the weekend.
Models continued to show a “minor increase” in demand nationally this weekend, associated with a system delivering cooler-than-normal conditions over the Great Lakes, Northeast and Mid-Atlantic, NatGasWeather said.
However, this early in the season heating degree days (HDD) have a limited impact on natural gas demand compared to the winter months, the firm added.
“A warmer than normal and slightly bearish pattern is currently favored to rule much of the U.S. Oct. 10-15,” NatGasWeather said. However, “the weekend data did add a few HDD across the Great Lakes and Northeast Oct. 14-15 and could add a few more in time.”
"gas" - Google News
October 03, 2022 at 08:07PM
https://ift.tt/lp2NcuQ
Natural Gas Futures Extend Sell-Off as Fundamentals Looking Weak - Natural Gas Intelligence
"gas" - Google News
https://ift.tt/8hloMXB
https://ift.tt/SBY5Euo
Bagikan Berita Ini
0 Response to "Natural Gas Futures Extend Sell-Off as Fundamentals Looking Weak - Natural Gas Intelligence"
Post a Comment