Naturalgas On MCX Settled Up 0.62%

Naturalgas on MCX settled up 0.62% at 194.50 but price movement was lacklustre trading during the day with US markets closed for a holiday. The dollar was confined to narrow ranges which also limited activity in natural gas. Although there has been some downgrading of temperature profiles, hot weather conditions are still likely to prevail across much of the US during the next few days and this will be important in driving increased demand for natural gas as air-conditioning use increases.

Comfortable conditions linger across the Great Lakes and Northeast to open the week with highs of upper 60s and 70s. However, temperatures of upper 80s to 100s will expand to cover most of the rest of the country mid-week for strong national demand as high pressure dominates besides a weak weather system with thunderstorms trapped under the middle of the ridge.

Warming will also briefly push into the Great Lakes and NE before cooling back off Fri-Mon as a new weather system arrives. Overall, nat gas demand will be increasing to high. Lastweek US EIA said in its weekly report that natural gas storage in the U.S. rose by 46bcf in the week ended June 23, below forecasts for a build of 52 billion.

That compared with a gain of 61bcf in the preceding week, an increase of 37 billion a year earlier and a five-year average rise of 72bcf. Total natural gas in storage currently stands at 2.816 trillion cubic feet, according to the US EIA, 10.2% lower than levels at this time a year ago but 6.4% above the five-year average for this time of year. Technically market is getting support at 192.3 and below same could see a test of 190.1 level, And resistance is now likely to be seen at 195.8, a move above could see prices testing 197.1.

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Suhani Verma

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