Yahoo News Natural Gas Price Fundamental Daily Forecast – Bullish Traders Hoping Cold Extends Beyond March 9
Natural gas futures are trading slightly higher on Wednesday after hitting their lowest level since February 12. The early price action suggests a slight change in the forecast to colder after yesterday’s reports showed little change.
A little of the short-covering could be related to speculation of higher demand next week beginning Tuesday through March 8, with a slightly stronger cool shot across the northern United States, according to NatGasWeather.
The forecaster also said, “There’s still potential for better pushes of subfreezing air into the northern United States around March 9-10, but far from convincing.”
At 12:57 GMT, April natural gas is trading $1.861, up $0.010 or +0.54%.
Short-Term Weather Outlook
According to NatGasWeather for February 26 to March 3, “A strong cold shot will push into the central US today with highs of 10s to 30s, then across the Southern Great Lakes, Ohio Valley and Northeast Thursday – Friday for a surge in national demand, aided by lows of 20s and 30s into the South and Southeast.”
“The West will be mostly mild as high pressure rules. Warm high pressure will expand to cover most of the U.S. early next week with widespread highs of 40s to 70s for a return to very light national demand.”
U.S. Energy Information Administration Weekly Storage Report
The EIA reported on February 20 that domestic supplies of natural gas fell by 151 billion cubic feet for the week-ended February 14.
Last year’s withdrawal was 163 Bcf and the five-year average draw is 136 Bcf, according to the EIA.
Total stocks now stand at 2.343 trillion cubic feet, up 613 billion cubic feet from a year ago, and 200 billion cubic feet above the five-year average, the government said.
Daily Forecast
Cold is coming, but it’s not expected to last. There will be a bump in demand, however, and cash prices are likely to be firm.
Most traders are pricing in a cold snap from March 3 to March 8. If it goes beyond March 9 then things could get interesting in the market. But at this time, forecasts calling for subfreezing temperatures after March 9 are “far from convincing,” NatGasWeather added.
The daily chart is still showing that $1.878 is the first level to overcome, followed by a series of retracement levels at $1.906, $1.924 and $1.947. The “wall of resistance” is likely to prevent any strong surges. However, price could spike higher if buyers are able to overcome $1.947 with conviction.
This article was originally posted on FX Empire
