Natural gas futures weakened on May 27 as the market players await EIA weekly inventory report later in the day. The gas price had gained 1.8 percent yesterday on the NYMEX.
On the Multi-Commodity Exchange (MCX), natural gas delivery for June dropped by Rs 0.90, or 0.41 percent, to Rs 218.90 per mmBtu at 15:32 hours IST with a business turnover of 16,566 lots.
Natural gas delivery for July eased Rs 0.70, or 0.32 percent, to Rs 221.50 per mmBtu with a business volume of 1,471 lots.
The value of June and July’s contracts traded so far is Rs 593.25 crore and Rs 16.09 crore, respectively.
MCX iCOMDEX Natural Gas Index fell 11.04 points or 0.41 percent to 2,685.18.
Kshitij Purohit, Product Manager, Currency and Commodities, CapitalVia Global Research Limited said, “MCX June Natural Gas is sustaining near the support line of 15-SMA of hourly chart placed at Rs 219. NYMEX Natural Gas has well remained below the mark of $3 in the previous session. If the price breaks above the recent highs, we may expect momentum towards the next level of Rs 228-229.50.”
Natural gas has witnessed mixed trade in the last few days amid position squaring near contract expiration and as market players assessed current mild weather in the US against the prospect of higher demand during summer.
A bigger than average rise in stocks may improve US supply and is negative for price. However, it is largely factored in owing to recent milder weather and stable production, said Kotak Securities.
The commodity has been trading higher than 5, 20, 50, 100 and 200 days' moving averages on a daily chart. The momentum indicator Relative Strength Index (RSI) is at 55.67, which suggests upbeat movement in the price.
At 1033 (GMT), the natural gas price was marginally down 0.36 percent quoting at $3.01 per mmBtu in New York.
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