• 4 minutes Is The Three Gorges Dam on the Brink of Collapse?
  • 8 minutes The Coal Industry May Never Recover From The Pandemic
  • 11 minutes China Raids Bank and Investor Accounts
  • 2 hours In a Nutshell...
  • 8 hours Is OilPrice a cover for Green Propganda
  • 18 hours Putin Paid Militants to Kill US Troops
  • 12 hours Putin Forever: Russians Given Money As Vote That Could Extend Putin's Rule Draws To A Close
  • 7 hours During March, April, May the states with the highest infections/deaths were NY, NJ, Ma. . . . . Today (June) the three have the best numbers. How ? Herd immunity ?
  • 12 hours Victor Davis Hansen on Biden's mental acuity " . . unfit to serve". With 1 out of 5 Democrats admitting it. How many Dem's believe it but will not admit it?
  • 2 days Biden admits he has been tested for Cognitive Decline several times. Didn't show any proof of test results.
  • 11 hours Tesla Model 3 police cars pay for themselves faster than expected, says police chief
  • 2 days Apology Accepted!
  • 18 hours The Political Genius of Donald Trump
  • 2 days Why Oil could hit $100
  • 3 days U.S. natural gas at major disadvantage in Europe and China.
  • 2 days Per most popular Indian websites it was Indian troops not Chinese troops breach of LAC that caused the clashes. If you know any Indian media that claim to the contrary please provide the link
The Newest Battlefield In The European Gas War

The Newest Battlefield In The European Gas War

The closing of a long-term…

Iran Sets Its Sights On LNG Superpower Status

Iran Sets Its Sights On LNG Superpower Status

Iran’s huge natural gas fields…

Natural Gas Price Plunge Could Soon Lead To Shut-Ins

Natural Gas Price Plunge Could Soon Lead To Shut-Ins

U.S. natural gas drillers are…

FX Empire

FX Empire

More Info

Premium Content

Natural Gas Analysis for the Week of August 15, 2011

October natural gas futures bucked the trend of most commodity markets last week by posting a strong 2.75% gain to finish at 4.071.

Technically the market posted a weekly closing price reversal bottom. A follow-through rally through 4.159 will be needed to confirm the bottom at 3.876. Based on the short-term range of 4.600 to 3.876, the first upside target is a retracement zone at 4.238 to 4.323. Downtrending Gann angles at 4.2100 and 4.2800 could also prove to be strong resistance.

The main trend is down on the weekly chart. A trade through 4.600 will turn the main trend back up, however without a support base; this rally is likely to fizzle. Despite the rally, it doesn’t look as if it was fueled by strong buying, but rather short-covering.

Natural gas price movements

Supply and demand played a role in last week’s rally. A smaller-than-expected increase in weekly natural gas storage added a boost. This ended weeks of larger-than-expected increases which were largely responsible for the selling pressure that took the market to its lowest level for the year.

Besides technically oversold conditions, the only key driving force left to consider is the weather. The absence of the heat that lingered over the Midwest and the East in July has dissipated, taking away one of the possible forces that could drive price higher. The National Hurricane Center is currently tracking four storms in the Atlantic Ocean that could develop into hurricanes. At this time, prices seem unaffected as they are not even close to natural gas production facilities in the Gulf of Mexico.

Short-covering due to oversold conditions may provide some support this week; however, gains are likely to be limited as production continues to remain at a high level.

Factors Affecting Natural Gas This Week:

• Supply and Demand. Expectations are that production will remain high, leading to increased supply and lower prices. Traders should always watch for a possible surprise such as a lower-than-expected increase. This would likely trigger a short-covering rally.

• Weather. Although excessive heat seems to be out of the equation, traders should continue to monitor tropical storms in the Atlantic to see if they have any chance of reaching production areas in the Gulf of Mexico. Although only about 7% of U.S. production takes place in this region, short traders tend to overreact to the upside when they hear hurricane news.

By. FX Empire

FXEmpire.com is the Forex flagship site of the FX Empire Network. The FX Empire Network provides readers with the most expert and most timely technical analyses, fundamental analyses and news-pieces; this in order to empower them to make for themselves the best possible financial decisions. The FX Empire Network’s other flagship sites include: StocksEmpire.com and CommoditiesEmpire.com.


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News