Natural gas futures traded firm on July 13 as participants increased their long position as seen in the open interest. The gas prices had soared Rs 3.74 or 2.52 percent yesterday on the MCX.
The commodity traded in the positive territory after a gap-up start tracking despite muted global cues.
On the MCX, natural gas delivery for July gained Rs 0.90, or 0.32 percent, to Rs 279 per mmBtu at 14.30 hours with a business turnover of 17,787 lots.
Gas delivery for August soared Rs 1 or 0.36 percent to Rs 278.40 per mmBtu with a business volume of 2,522 lots.
The value of July and August's contracts traded so far is Rs 620.60 crore and Rs 42.82 crore, respectively.
MCX iCOMDEX Natural Gas Index was up 11 points or 0.32 percent to 3,401.18.
Sriram Iyer, Senior Research Analyst at Reliance Securities said, “International natural gas futures have started flat to marginally weaker this Tuesday morning and early afternoon in Asian trade. Technically, NYMEX Natural Gas could trade in a range of $3.60-3.90 levels.”
On the domestic front, MCX Natural Gas July holds strong support near Rs 275-272 levels whereas resistance is at Rs 279-282 levels, he added.
As per National Oceanic Atmospheric Administration (NOAA) report, the weather is expected to remain warmer than normal for the next two weeks which is likely to increase cooling demand.
The United States natural gas consumption averaged 83.3 billion cubic feet (Bcf) per day in 2020, down 2.2 percent from 2019, said US Energy Information Administration.
The agency expects that natural gas consumption to decline by 1.1 percent in 2021 and to grow by 0.7 percent in 2022.
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 RSI is at 70.22, which suggests bullish movement in the price.
Kshitij Purohit, Product Manager, Currency & Commodities, CapitalVia Global Research Limited, said, "MCX Natural future is trading with sideways momentum, sustaining through the support of Rs 275 since previous evening session. The key resistance holds at Rs 280 and if the price will cross this level, we may anticipate a more bullish run towards Rs 285.”
At 0912 GMT, the natural gas price was modestly lower 0.13 percent at $3.74 per mmBtu in New York.
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