Natural gas futures were slightly higher during midday trade in Europe today, after dropping on Thursday, after the US posted a sizable weekly gain for natural gas inventories.
Front month natural gas futures, due in August, were down 0.68% at the New York Mercantile Exchange to trade for $4.091 per million British thermal units at 9:02 GMT today. Prices ranged from $4.087 to $4.110 per mBtu. The contract slumped by 4.01% yesterday, erasing minor gains from earlier this week.
“In light of the very large builds in gas storage, including today’s, we’re seeing the possibility of a further deterioration in prices,” Teri Viswanath, director of commodities strategy at BNP Paribas SA in New York, said for Bloomberg after the EIA report. “This is the traditional peak of summer heat, and it’s just not materializing.”
The US Energy Information Administration (EIA) posted its weekly natural gas storage report yesterday, revealing 107 billion cubic feet (Bcf) were added to stockpiles, beating estimates of a 95-103 Bcf injection. Storage levels narrowed to gap to last years level to 22.2%.
US weather outlook
NatGasWeather.com reported on Friday that the cold blast from Canada has pushed deep into the southern US, cooling a significant portion of the country. However, the systems has now weakened and will allow for a rise in temperatures in the next few days. Another cool system over the South Plains will also impact readings, though only slightly. The extreme southern and the western US remain in the grips of strong and resilient high pressure, supporting the moderately high temperatures. Cooling demand over the next seven days will probably be low-to-moderate.
In the 8-14 day outlook, NatGasWeather.com projected a neutral trend for the US. Higher pressure will be returning to the northeastern half of the US. However, more blasts will be pushing southwards into the Northeast and Midwest later in the period, probably lowering temps again.
According to AccuWeather.com, New York will be slightly cooler than normal today, with temperatures between 66 and 82 degrees Fahrenheit, a few below average. It will be somewhat cooler over the weekend, with mixed clouds and sun, before more heat next week. Chicago will be sunny, though cooler-than-normal today, with readings ranging 61-78, several degrees below average. Readings will be slightly higher for the weekend, ahead of a significant rise early next week.
In the South, Houston will see slightly cooler weather today, with readings between 75 and 88 Fahrenheit, a few degrees below average. Thunderstorms are bound for today and the weekend, while temperatures will probably climb. Over on the West Coast, Los Angeles will be sunny, though cooler than normal today, with temperatures ranging 64-80 degrees, a few below average. Readings will probably slightly drop for the weekend, before rising to above-average next week.
Technical view
According to Binary Tribune’s daily analysis, in case natural gas for settlement in August penetrates the first resistance level at $4.064 per million British thermal units, it will encounter next resistance at $4.174. If breached, upside movement will probably attempt to advance to $4.238 per mBtu.
If the energy source drops below its first resistance level at $3.890 per mBtu, it will see support at $3.826. If the second key support zone is breached, the power-station fuel’s downward movement may extend to $3.716 per mBtu.
TradingPedia.com is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover 
