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Saturday, October 16, 2021

MCX Natural Gas under short covering; Resistance seen at 361.4

Technically Natural Gas market is under short covering as market has witnessed drop in open interest by 31.23% to settled at 2425 while prices up 3.6 rupees.

Now MCX Natural Gas is getting support at 352.7 and below same could see a test of 348.6 levels, and resistance is now likely to be seen at 361.4, a move above could see prices testing 366.

Natural Gas yesterday settled up by 1.02% at 356.7 amid continued strong interest in U.S. liquefied natural gas exports from soaring global gas prices.

However upside seen limited on growing expectations the United States will have enough gas in storage for the upcoming winter heating season. U.S. gas stockpiles were about 7.1% below their five-year normal for this time of year.

The storage situation was much worse in Europe where prices have soared to record highs primarily because stockpiles in some countries were 20% or more below normal for this time of year.

Despite reductions at several plants this month, data provider Refinitiv said the amount of gas flowing to U.S. LNG export plants was only down to an average of 10.4 billion cubic feet per day so far in September from 10.5 bcfd in August.

Refinitiv said gas output in the U.S. Lower 48 states fell to an average of 90.7 bcfd so far in September from 92.0 bcfd in August, due mostly to Ida-related losses along the Gulf Coast.

That compares with a monthly record high of 95.4 bcfd in November 2019. About 0.6 bcfd, or 25%, of gas production in the U.S. Gulf of Mexico remained shut-in since Ida hit Louisiana on Aug. 29, government data showed.

Trading Ideas:
–Natural Gas trading range for the day is 348.6-366.
–Natural Gas rose amid continued strong interest in U.S. liquefied natural gas exports from soaring global gas prices.
–However upside seen limited on growing expectations the United States will have enough gas in storage for the upcoming winter heating season.
–U.S. gas stockpiles were about 7.1% below their five-year normal for this time of year.

Courtesy: Kedia Commodities

Source: Comodity Online

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