Weekly Outlook on Natural Gas - 23 Jun 2023
Last Updated: 23rd June 2023 - 06:12 pm
Natural gas prices climbed near 15% for June after a long sideways momentum as the bulls have been actively participating the last three weeks. Prices rose amid a drop in output and forecasts for a higher demand outlook. According to the Energy Information Administration, or EIA report, the total inventories of fuel in storage rose by 95bcf last week compared with 88-bcf for the week ended on June 16.
With a near 15% gain for June, gas futures on the Henry Hub are headed for their best performance since August — the month they hit a 14-year high of $10 per mmBtu. While summer weather hasn’t hit its typical baking point across the country, cooling demand is inching up by the day, particularly in Texas.
On a weekly timeframe, the Natural Gas future had reversed from 180 levels after taking trendline support. The price also witnessed support at 21-weeks Simple Moving Averages and sustained above Middle Bollinger Band formation.
On the daily chart, natural gas prices formed a base near 165-170 levels, where the price had consolidated for a long time. A momentum indicator RSI (14) has climbed to the 61 mark, which signals positive strength in the near term. The next leg of the rally is likely to push prices towards 223/235 levels in the near term. The immediate support is observed at around 200 levels. If the price remains below it, on a closing basis, that could lead to further correction in the short term.
Here, we are sideways to bullish on natural gas and expecting more upside moves in prices for the coming week. So traders can follow the buy on dips strategy on the counter for the potential target of 223/235 levels.
Important Key Levels:
MCX Natural Gas (Rs.) |
NYMEX Natural Gas ($) |
|
Support 1 |
200 |
1.94 |
Support 2 |
184 |
1.72 |
Resistance 1 |
235 |
2.52 |
Resistance 2 |
248 |
2.70 |
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