Long Natural Gas based on temperature decrease in US
Fundamental:
15.01.23
Weather reports point to the possibility of a further drop in gas prices amid forecasts indicating the likelihood of unusually mild temperatures in the United States through mid-January, Gelber's note said.
16.01.23
After consecutive weekly declines at the start of the new year, natural gas futures rebounded on Tuesday amid expectations of more cold spells later this month.
The spot price fell about 27.6 cents on Friday after several days of unusually warm weather to start 2023. Production also proved strong and stood at around 101 billion cubic feet per day. It remained near record levels of around 102 billion cubic feet per day.
However, natural gas prices are more than 50% lower than they were just a month ago, and for futures contracts to maintain an upward trajectory, cold air needs to arrive soon and other February predictions may need to be made.
The U.S. National Oceanic and Atmospheric Administration's eight-to-14-day forecast calls for below-average temperatures in the western, midwestern and southwestern parts of the lower 48 states.
18.01.23
US gas prices are rising today (knowing that volumes are limited due to MLK Day), while European prices are falling sharply. There are new weather forecasts for the last week of January in the United States. Temperatures are expected to drop significantly across most of the United States, to below average levels. It turns out that February could bring more volatility for natural gas. Seasonality indicates two local troughs (cold winds) - January 21 and February 4.
"Looking ahead, it's not out of the question that NYMEX gas futures will return to $5 mmBtu or higher, but it will take a lot of arctic air to dominate the nation for several weeks," adds Gelber's note. "Conversely, if the weather forecast models revert to a longer spell of warmth, this would set the stage for new lows for NYMEX gas futures."
Technical:
- RSI over 30.0 + Standard deviation increasing (high volatility)
- High volume at $3.54
- Support reached
15.01.23
Weather reports point to the possibility of a further drop in gas prices amid forecasts indicating the likelihood of unusually mild temperatures in the United States through mid-January, Gelber's note said.
16.01.23
After consecutive weekly declines at the start of the new year, natural gas futures rebounded on Tuesday amid expectations of more cold spells later this month.
The spot price fell about 27.6 cents on Friday after several days of unusually warm weather to start 2023. Production also proved strong and stood at around 101 billion cubic feet per day. It remained near record levels of around 102 billion cubic feet per day.
However, natural gas prices are more than 50% lower than they were just a month ago, and for futures contracts to maintain an upward trajectory, cold air needs to arrive soon and other February predictions may need to be made.
The U.S. National Oceanic and Atmospheric Administration's eight-to-14-day forecast calls for below-average temperatures in the western, midwestern and southwestern parts of the lower 48 states.
18.01.23
US gas prices are rising today (knowing that volumes are limited due to MLK Day), while European prices are falling sharply. There are new weather forecasts for the last week of January in the United States. Temperatures are expected to drop significantly across most of the United States, to below average levels. It turns out that February could bring more volatility for natural gas. Seasonality indicates two local troughs (cold winds) - January 21 and February 4.
"Looking ahead, it's not out of the question that NYMEX gas futures will return to $5 mmBtu or higher, but it will take a lot of arctic air to dominate the nation for several weeks," adds Gelber's note. "Conversely, if the weather forecast models revert to a longer spell of warmth, this would set the stage for new lows for NYMEX gas futures."
Technical:
- RSI over 30.0 + Standard deviation increasing (high volatility)
- High volume at $3.54
- Support reached