With supportive March cold now largely in the rearview mirror, natural gas futures continued to come under pressure in early trading Tuesday. Coming off an 11.5-cent sell-off in the previous session, the April Nymex contract was down 3.7 cents to $2.186/MMBtu at around 8:50 a.m. ET.
The April contract could have further to fall before it rolls off the board, according to ICAP Technical Analysis.
“Would not rule out a test of $2.113, $2.069-2.038, $1.967, even fresh lows (in spot continuation terms) for the April contract ahead of expiration,” ICAP analyst Brian LaRose told clients following Monday’s session.
“However, I am still quite skeptical of the bears’ ability to push the May contract beneath the $1.967 spot low put in place back in February,” LaRose added. “For that reason, we will be on the lookout for any signs of bottoming action into the end of the month.”
EBW Analytics Group analyst Eli Rubin attributed Monday’s losses to a “weak technical setup and softening physical demand.” Technicals point to further downward pressure on prices in the near term, according to Rubin.
Aside from above-normal weather-driven demand for the March 17-23 storage period, “it should be noted that most country-wide cold anomalies already transpired over the weekend,” Rubin said.
Milder heating demand through the end of the work week could lead to weakness in the physical market that could in turn weigh on futures, the analyst said.
Still, the next four Energy Information Administration (EIA) storage reports are on track to shrink the year-on-five-year-average storage surplus by over 100 Bcf, according to Rubin.
What’s more, “the injection season contracts appear oversold. Further downward pressure, however, may be likely first,” Rubin added.
Meanwhile, the latest 11- to 15-day forecast (March 31-April 4) from Maxar’s Weather Desk Tuesday continued to show a pattern that would deliver slightly above normal conditions for the southern Lower 48 and below-normal temperatures for the West.
“The forecast is near normal for temperatures from the Midwest to the East,” the forecaster said.
For the six- to 10-day period, from Sunday through March 30, Maxar said it expects above normal conditions for the eastern half of the Lower 48 on day six, though temperatures should “briefly fall below normal in the Midwest at mid-period and the Mid-Atlantic late. Below and much below normal temperatures are steady in the West.”
"gas" - Google News
March 21, 2023 at 08:04PM
https://ift.tt/9jZsCwm
April Natural Gas Under Pressure Early as Technicals Seen Pointing to Further Declines - Natural Gas Intelligence
"gas" - Google News
https://ift.tt/trRbsDn
https://ift.tt/2tXxvDF
Bagikan Berita Ini
0 Response to "April Natural Gas Under Pressure Early as Technicals Seen Pointing to Further Declines - Natural Gas Intelligence"
Post a Comment