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Natural gas futures trade marginally up ahead of inventory report

Technically, NYMEX Natural Gas could trade in a range of $3.80-$4.050 levels.

Mumbai / August 26, 2021 / 03:22 PM IST

Natural gas futures were modestly higher on August 26 as market players awaited Energy Information Administration (EIA) weekly inventory report later in the day. Gas prices had risen 0.2 percent yesterday on the NYMEX.

The energy commodity traded in the green after a gap-up start in the afternoon session, tracking a firm global trend.

On the MCX, natural gas delivery for September jumped Rs 1.40, or 0.48 percent to Rs 293 per mmBtu at 14:46 hours with a business turnover of 11,602 lots.

Gas delivery for October soared Rs 1.40, or 0.47 percent, to Rs 298.70 per mmBtu with a business volume of 2,338 lots.

The value of September and October's contracts traded so far is Rs 701.82 crore and Rs 37.39 crore, respectively.

Close

MCX iCOMDEX Natural Gas Index increased 18.24 points or 0.51 percent to 3,563.83.

Sriram Iyer, Senior Research Analyst at Reliance Securities said, “International natural gas futures have turned slightly higher this Thursday early afternoon in Asian trade. Technically, NYMEX Natural Gas could trade in a range of $3.80-$4.050 levels.”

"On the domestic front, MCX Natural Gas August holds strong support near 287.33-283.07 levels. Resistance is at 297.23-302.87 levels,” Iyer noted.

Market participants now look forward to EIA weekly inventory report scheduled for release later today. Expectations are for a 40 billion cubic feet (Bcf) build in stockpiles, according to survey provider Estimize.

The gas price has been supported by increased cooling demand and robust US LNG exports.

Technicals

The commodity has been trading higher than 5, 50, 100, and 200 days' moving averages but lower than the 20-day moving averages on the daily chart. The momentum indicator RSI is at 53.05, which suggests a positive movement in the price.

While we have seen mixed trade in the last few days, natural gas continues to trade within the broad range of $3.8-4.2/mmBtu and unless there are fresh triggers price may continue within this range. The general bias, however, is weak amid demand uncertainty, said Kotak Securities.

At 0927 GMT, the natural gas price was up 0.33 percent at $3.93 per mmBtu in New York.

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Sandeep Sinha
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