MCX Nickel may trade between 906.9-957.3 levels
MCX Zinc expected to trade between 174.7-186.5 levels
MCX Copper likely to trade in a range between 415.7-440.1
Crude Oil market under fresh buying; Support seen at 4682
Silver market under short covering; Support seen at 38169
Technically Natural Gas market is under short covering as market has witnessed drop in open interest by 16.4% to settled at 2650 while prices up 0.2 rupees.
Now MCX Natural Gas is getting support at 187.2 and below same could see a test of 186 levels and resistance is now likely to be seen at 189.3, a move above could see prices testing 190.2.
Natural Gas on MCX settled up 0.11% at 188.50 gained marginally on short covering gained after prices have been under pressure over the last few weeks. Natural gas prices rebounded but traders are reluctant to purchase natural gas due to cooler than normal weather than is forecast to cover most of the United States over the next 8-14 days according to the National Oceanic Atmospheric Administration.
Cooler than normal weather reducing natural gas demand as it drops the need for peak electricity demand. With inventories below the 5-year average, it’s hard to determine if inventories will reach the 5-year average by the end of the injection season. Trader’s now await Thursday’s inventory report from the department of Energy.
A key uncertainty for end-of-season inventory levels is weather-driven demand from the electric power sector. Natural gas demand for electricity generation tends to peak in the summer months with demand for air conditioning.
The current temperature outlook for August–October is for above-normal temperatures throughout the Lower 48 states. The Short Term Energy Outlook is currently forecasting natural gas use in the electric power sector for August–October to average about 31 Bcf per day, up 2 per day from last year for the same time period.
While production is largely forecasted to keep up with growing sector demand and exports, more extreme weather could lead to higher demand for natural gas-fired generation and, subsequently, a lower inventory level by October 31.
Trading Ideas:
–Natural gas trading range for the day is 186-190.2.
–Natural gas settled flat as production remains at record levels and on forecasts for less hot weather and lower demand over the next two weeks.
–In recent months, the biggest factor affecting the U.S. gas market has been speculation on whether production, which is at record levels.
–Production in the lower 48 U.S. states averaged a record high 80.9 billion cubic feet per day (bcfd) over the past 30 days.
Courtesy: Kedia Commodities
Source: Commodityonline.com
