Natural Gas markets have been sliding this week and rally has been capped by aggressive sellers. Natural Gas has been trading in a range on MCX and the price in the global market has been in a range.

Natural Gas Investing - Generatebucks.com
Natural Gas Investing - Generatebucks.com


Price action reflects low demand and market has been taken over by short-sellers. Ralies  have been capped by sellers. Bullish traders are hoping to hear cold weather forecast.

According to NatGasWeather for January 9-15, “A strong cold front will push across the Great Lakes and Northeast in US for the next several days with lows behind the cold front reaching the 0s to 20s for strong demand. However, much of the rest of the US will be mostly mild with highs of 40s to 70s to counter. Overall, national demand will be increasing to moderate-high late this week into early next week.”

This could be a the right time for bulls to enter and fill the gap underneath. Natural Gas market has been oversold too early and the gap needs to be filled.

Forecast

Based on the weather and speculative sellers in the market we can expect Natural gas prices to be capped but we could definitely see some bullish movement.

Looking at the weather and decline in Indian Rupee, we can expect Natural Gas to trade sideways to upside today.

I would recommend a buy in Natural Gas around 209 for a quick target of 214 wit stop loss of 207. Natural Gas fundamental are completely bearish but a rally is expect to fill a gap underneath. Traders are recommended to follow strict stop loss.

Positional traders should hold and enter into a short position around 220 later this week or early this week. With cold waves expected around Jan 13, an increase in demand may allow prices to rally around 220-225.

Crude Oil Prices


Yesterday Crude Oil prices were seen trading at 3700 on MCX but the upside momentum was capped after the EIA report was released.

The Energy Information Administration reported a crude oil inventory draw of 1.7 million barrels for the first week of 2019, after a 6.9-million-barrel build in the last week of 2018. Inventories remain over the five-year seasonal average, the authority said.

Looking at the current fundamentals, I would advise a short position in Crude at 3670 for target of 3620 with stop loss of 3690.

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