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Natural gas futures down 0.62% to Rs 192.50 per mmBtu on weak global trend

The commodity has been trading lower than 5, 20, 50 and 100 days' moving averages but higher than the 200-day moving average on a daily chart.

Mumbai / March 10, 2021 / 02:58 PM IST

Natural gas futures dipped to Rs 192.50 per mmBtu on March 10 as participants increased their short positions as seen by the open interest. Natural gas price had fallen 0.1 percent yesterday on the NYMEX.

The energy extended decline in the afternoon after a gap-down start tracking weak global trends.

The commodity has been trading lower than 5, 20, 50 and 100 days' moving averages but higher than the 200-day moving average on a daily chart. The Relative Strength Index (RSI) is at 39.63 which indicates bearish momentum in prices.

Kotak Securities said natural gas may remain under pressure on weakening demand outlook however sharp movement is unlikely ahead of the weekly inventory report tomorrow. The focus may continue to be on US weather and trends in energy prices.

The gas prices continued to slide lower however trading range has narrowed down amid a lack of fresh cues.

The US Energy Information Agency (EIA) predicts the US production of dry natural gas averaged 87.8 billion cubic feet (Bcf) per day in February, which is down 92.4 Bcf per day in December as a result of the freeze-off in the southern US.

Sriram Iyer, Senior Research Analyst at Reliance Securities said, “International natural gas futures have started marginally lower this Wednesday morning and early afternoon in Asian trade. Technically, NYMEX Natural Gas could trade in a range of $2.50-2.85 levels.”

MCX March Natural Gas holds resistance near Rs 195-198 levels and supports near Rs 190-187 levels, he said.

MCX iCOMDEX Natural Gas Index dropped 15.81 points or 0.62 percent to 2,536.12.

In the futures market, natural gas for March delivery touched an intraday high of Rs 193.70 and an intraday low of Rs 191.30 per mmBtu on MCX. So far in the current series, natural gas has touched a low of Rs 175 and a high of Rs 222.20.

Natural gas delivery for March slipped Rs 1.20, or 0.62 percent, to Rs 192.50 per mmBtu at 14:26 hours IST with a business turnover of 12,320 lots.

Natural gas delivery for April fell Rs 1, or 0.51 percent, to Rs 195.80 per mmBtu with a business volume of 2,229 lots.

The value of March and April’s contracts traded so far is Rs 681.21 crore and Rs 30.53 crore, respectively.

Kshitij Purohit, Product Manager, Currency & Commodities, CapitalVia Global Research Limited said, “Natural gas has support at Rs 192 levels below it may come down to Rs 186 levels while the resistance for energy is at Rs 197.

At 08:59 (GMT), the natural gas price slid 1.05 percent quoting at $2.63 per mmBtu in New York.

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Sandeep Sinha