Natural gas futures lost some of Thursdays gains during early trading in Europe today. Yesterday investors realized stockpiles will need to mark strong gains consistently throughout summer season to replenish pre-winter levels, and the unlikeliness of that happening prompted investors to buy, even with the sizable growth in inventories.
Front month natural gas futures, due in June, lost 0.29% at the New York Mercantile Exchange to trade for $4.456 per million British thermal units at 9:30 GMT. Prices ranged from $4.435 to $4.458 per mBtu. Yesterday the contract closed for a 2.34% gain as the US government report on supplies prompted some inverse trading. Earlier it reached the lowest level in a month at $4.289 per mBtu. Over the last 4 days the blue fuel lost 1.30% as the US cold season is coming to an end.
US natural gas stockpiles added 105 billion cubic feet, which is the highest injection in almost a year. However, inventories remain a trillion cubic feet below the 5-year average at this point, and have almost 3 trillion cubic feet to gain, in order to restore historic levels before winter. This means an average of more than 100 billion cubic feet in gains each week, and ahead of summer air-conditioning season, with some regional cold persisting, this seems somewhat unlikely. That implied deficit come winter weighed on investors minds, and traders bought more even with growing supplies.
According to AccuWeather.com New York should expect a thunderstorm and heavy rains today, though temperatures will range 55-70 degrees Fahrenheit, which is in line with historic averages. Over the next few days the rain and clouds will give way to the sun, lifting readings slightly, though overall the temperatures will be completely normal through next week. Chicago will be 15-20 degrees colder than usual today, with lows in the mid 30s and highs below 50. Temperatures will slightly rise over the next few days, but will remain below usual for the weekend, when the highs will be in the upper 50s and low 60s, while the lows will settle in the mid to high 40s. Los Angeles set a new record-high temperature yesterday, reaching 102 degrees Fahrenheit. Today readings will be slightly lower, with highs in the mid 90s, before they normalize for the weekend and into next week.
Technical view
According to Binary Tribune’s daily analysis, in case natural gas for settlement in June penetrates the first resistance level at $4.556 per million British thermal units, it will encounter next resistance at $4.642. If breached, upside movement will probably attempt to advance to $4.776 per mBtu.
If the energy source drops below its first resistance level at $4.336 per mBtu, it will see support at $4.202. If the second key support zone is breached, the power-station fuel’s downward movement may extend to $4.116 per mBtu.
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