NG: UNG: BOIL: Natural Gas Rebounded on Feb 2021 Roll
Natural Gas prices rebounded after dropping earlier in the week from $2.5 to $2.25 on warm weather. Prices rebounded on tight balances, oversold technical conditions,
and roll into February 2021 contract. Support is expected to hold, as LNG flows are above 11 Bcf/d and balances are tight, with last draw at -152 Bcf.
Technical Analysis: 4 Hr chart shows oversold condition. Support is seen at $2.25. However, double bottom is still possible, before going higher around January 10.
Potential price target for the next leg up is $2.75 - $2.8. Upside potential for NG and BOIL may be limited due to roll into lower March 2021 contract on January 22 -27.
Fundamental Analysis: Bullish picture with tight balances and potential for a deficit is possible going into 2021. Lower 48 state production lost -4 Bcf/d vs. 2020,
while gas exports increased +4 Bcf/d, resulting in net increase in demand of 8 Bcf/d. Lower 48 production is expected to remain at 91 Bcf/d, while LNG flows and
Mexico exports will total 16 Bcf/d. HFIR energy believes, that forward curve is underpriced at avg. of $2.58/MMBtu. Should weather turn colder after January 11, 2021,
as projected by NatGasWeather, we may see NG prices bounce back to $2.7-$2.8 levels. Cash prices are likely to go much higher during winter. However, NG and BOIL,
will start rolling into lower March contract around January 22 -27, which may bring futures prices back to their current support level at $2.3-$2.5 at that time.
Overall picture for NG in 2021 is bullish, given lower production and higher LNG demand and exports remain in place. Traders are bullish EQT and BOIL (day trade).
Short sellers will still have their opportunities on selling 4 Hr tops. KOLD is an inverse daily ETF, that does well during March - April contract timeframe.
and roll into February 2021 contract. Support is expected to hold, as LNG flows are above 11 Bcf/d and balances are tight, with last draw at -152 Bcf.
Technical Analysis: 4 Hr chart shows oversold condition. Support is seen at $2.25. However, double bottom is still possible, before going higher around January 10.
Potential price target for the next leg up is $2.75 - $2.8. Upside potential for NG and BOIL may be limited due to roll into lower March 2021 contract on January 22 -27.
Fundamental Analysis: Bullish picture with tight balances and potential for a deficit is possible going into 2021. Lower 48 state production lost -4 Bcf/d vs. 2020,
while gas exports increased +4 Bcf/d, resulting in net increase in demand of 8 Bcf/d. Lower 48 production is expected to remain at 91 Bcf/d, while LNG flows and
Mexico exports will total 16 Bcf/d. HFIR energy believes, that forward curve is underpriced at avg. of $2.58/MMBtu. Should weather turn colder after January 11, 2021,
as projected by NatGasWeather, we may see NG prices bounce back to $2.7-$2.8 levels. Cash prices are likely to go much higher during winter. However, NG and BOIL,
will start rolling into lower March contract around January 22 -27, which may bring futures prices back to their current support level at $2.3-$2.5 at that time.
Overall picture for NG in 2021 is bullish, given lower production and higher LNG demand and exports remain in place. Traders are bullish EQT and BOIL (day trade).
Short sellers will still have their opportunities on selling 4 Hr tops. KOLD is an inverse daily ETF, that does well during March - April contract timeframe.