Naturalgas On MCX Settled Up 1.32% At 207.30

Naturalgas on MCX settled up 1.32% at 207.30 inched up from weak momentum pushing higher, though chilly spring weather forecasts limited any rally. Although cool weather is currently in the forecast, this news was probably priced into the market late last week. Investors are now focused on the longer-term weather pattern. This is raising concerns over whether it will be hot enough in the summer to generate better-than-average demand. Currently, bullish investors are thinking that production has fallen far enough to create an undersupplied condition leading into the summer. Bearish traders are ignoring the short-term condition and focusing on longer-term forecasts which are uncertain about summer temperatures. Meanwhile a weather system and associated cool front will track through the East the next few days, bringing an end to recent unseasonably warm conditions.

The western and southern US will see above normal highs of upper 60s to 80s, locally 90s over the SW and S. Texas. A reinforcing cool shot will push across the Great Lakes and Northeast this weekend into early next week to keep below normal temperatures in place. Total natural gas in storage currently stands at 2.189tcf, according to the US EIA, 14.0% lower than levels at this time a year ago but 13.7% above the five-year average for this time of year. The EIA's next storage report due Thursday is expected to show a build in a range between 57 and 65bcf in the week ended April 28. That compares with a gain of 74bcf in the preceding week, an increase of 68 billion a year earlier and a five-year average rise of 63bcf. Technically market is getting support at 205.2 and below same could see a test of 203 level, And resistance is now likely to be seen at 208.6, a move above could see prices testing 209.8. 
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Suhani Verma

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