Natural gas futures on June 15 hit a new high for the June series during intraday trade on the Multi-Commodity Exchange (MCX) as participants increased their long position as seen by the open interest. The gas prices had risen 1.7 percent yesterday on the NYMEX.
The energy prices traded in the positive territory after a gap-up start in the afternoon session despite mixed global cues.
On the MCX, natural gas delivery for June jumped by Rs 2, or 0.82 percent, to Rs 245.50 per mmBtu at 14:31 hours with a business turnover of 24,752 lots.
Gas delivery for July gained Rs 1.90, or 0.77 percent, to Rs 247.20 per mmBtu with a business volume of 6,105 lots.
The value of June and July contracts traded so far is Rs 583.10 crore and Rs 63.59 crore, respectively.
MCX iCOMDEX Natural Gas Index increased 23.14 points or 0.77 percent to 3,011.24.
Natural gas has continued to set new highs indicating strong upward momentum; however, with mixed factors one needs to be cautious and wait for corrective dips to create fresh long positions, said Kotak Securities.
“Natural gas has resumed higher at Rs 245, trading towards the psychological resistance of Rs 250, sustaining above the support of 15-SMA of intraday chart placed near Rs 242.60. The overall trend likely to be marginally bullish for today’s session,” said Kshitij Purohit, Product Manager, Currency and Commodities, CapitalVia Global Research Limited.
Natural gas speculators raised their net long US Natural Gas futures and options positions by 12,313 contracts to 52,920 in the week to June 8, the US CFTC data showed.
Samer Mosis, Team Lead - EMEA LNG, S&P Global Platts said “Global liquefaction utilisation has fallen by 2.5 percent over the past month as numerous facilities went down for maintenance; but with full dispatch economics catalysing strong year-on-year gains from price-sensitive producers such as the US, Egypt and Malaysia, global loadings remain resilient compared to year-ago levels, trending 129 million cu m/d higher year on year (+ 9.7 percent).”
The severe heatwave in the western US regions would boost demand for increased cooling, which is likely to cap the gas downside.
The gas prices were also supported by higher global natural gas prices and higher crude oil price.
Technicals
The commodity has been trading higher than 5, 20, 50, 100 and 200-days' simple moving averages and exponential moving averages on the daily chart. The momentum indicator Relative Strength Index (RSI) is at 70.39, which suggests upbeat movement in the price.
At 09:13 GMT, the natural gas price slightly dipped 0.03 percent at $3.35 per mmBtu in New York.
Trading Strategy
MCX Natural gas is likely to trade with positive bias for the session with support placed at Rs 242-239 levels whereas resistance is at Rs 249-252 levels.
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