• 4 minutes Will We Ever See 100$+ OIL?
  • 8 minutes Iran downs US drone. No military response . . Just Destroy their economy. Can Senator Kerry be tried for aiding enemy ?
  • 11 minutes Energy Outlook for Renewables. Pie in the sky or real?
  • 3 hours Shale Oil will it self destruct?
  • 10 hours White House insider who predicted Iran False Flag, David Goldberg found dead in his New York apartment
  • 1 day NYT: Mass Immigration Roundups in U.S. to Start Sunday
  • 3 hours Migration From Eastern Europe Raises German Population To Record High
  • 4 hours Excellent Choice: Germany's Von der Leyen Secures Powerful EU Executive Top Job
  • 15 hours Germany exits coal: A model for Asia?
  • 1 day Carrot And Stick: North Korea Suggests It Might Lift Weapons Test moratorium
  • 3 hours Washington Post hit piece attacking oil, Christians and Trump
  • 1 day South Korea imports No Oil From Iran in June - First-Half Imports Fall 37%
  • 12 hours Starlink Internet Courtesy of Tesla
  • 15 hours A Silence is heard
  • 2 days U.S.- Taiwan: China Says Will Freeze Out U.S. Companies That Sell Arms To Taiwan
  • 1 day Trump vs. Xi Trade Battle, Running Commentary from Conservative Tree House
FX Empire

FX Empire

More Info

Premium Content

Natural Gas Analysis for the Week of August 8, 2011

Nearby Natural Gas futures fell sharply lower last week, briefly piercing the low for the year at 3.917 while reaching 3.901 before settling the week at 3.941. The poor outlook for the U.S. economy was the main reason for the weakness. Traders pushed prices lower as supply continued to grow and expectations for a drop in demand continued to grow.

Although the market has reached a perceived extreme low, there doesn’t appear to be any panic selling or capitulation. This typically means the market is being driven by the true forces of supply and demand rather than aggressive speculation.

Natural gas price movement

Over the past month the only factor driving this market higher was a quick short-covering rally to 4.581 because of an excessive heat problem in the Midwest and East Coast. Since this top was posted in mid to late July, the market has gone straight down. Unless there is a hurricane scare in the Gulf of Mexico or a return of the heat, expectations are for a sideways-to-lower trade over the near-term.

Factors Affecting Natural Gas This Week:

• Weather. As the hurricane season reaches its peak, natural gas traders will be watching more closely for increased activity in the Gulf of Mexico. Although only about 7% of natural gas production comes from this region, any production shutdowns or storage threats could trigger a short-covering rally.

• Supply and demand will continue to be the main price driver. Perceptions of a slowdown in the economy will keep downside pressure on prices. Last week another larger-than-expected injection into inventory pushed price below $4.00. More of the same this week could keep the market pinned under this level.

• A general sell-off in equities and commodities is another factor that could drive natural gas prices lower.

• Oversold technical conditions may underpin the market or even trigger a short-covering rally. Even if this occurs, the downtrend is expected to remain intact. A strong rally is likely to give traders another opportunity to short the market.

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
Download on the App Store Get it on Google Play