Natural gas futures recovered on September 30 after a sharp selloff in the global market in the previous session as investors awaited weekly inventory data from the Department of Energy. Gas prices had tumbled 6.23 percent yesterday on the NYMEX.
The energy commodity extended gains to trade at the day’s high after a gap-up start, tracking a positive global trend. Natural gas has been the best performing commodity in September gaining 30.25 and 27.60 percent, respectively, on the MCX and NYMEX.
It has delivered a return of 127.68 percent so far in 2021 on the domestic bourse making it the top-performing asset across all classes.
On the MCX, natural gas delivery for October rose Rs 7.20, or 1.76 percent to Rs 415.20 per mmBtu at 14:34 hours with a business turnover of 5,601 lots.
Gas delivery for November surged Rs 7.10, or 1.70 percent, to Rs 424.40 per mmBtu with a business volume of 2,293 lots.
The value of October and November's contracts traded so far is Rs 1,179.03 crore and Rs 71.78 crore, respectively.
MCX iCOMDEX Natural Gas Index increased 86.76 points or 1.76 percent to 5,002.84.
Market participants now look forward to EIA weekly inventory report scheduled to be released later in the day. Expectations are for a 66 billion cubic feet (Bcf) build in stockpiles according to survey provider Estimize.
The weather is expected to stay warmer than normal over the next 6-10 and 8-14 days, according to National Oceanic and Atmospheric Administration.
Kshitij Purohit, Product Manager, Currency & Commodities, CapitalVia Global Research said, “Natural gas price fell 7% on Wednesday, reversing their previous trend. At $5.22, support might be found near the 10-day moving average and resistance is at $6.32. MCX Natural gas has support near Rs 403 whereas resistance is at Rs 427.”
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 66.32, which indicates bullish movement in the price.
“Expect a range-bound trading inside Rs 390-435 level with a mild negative bias,” said Geojit Financial Services.
At 09:22 GMT, the natural gas price jumped 2.06 percent to $5.59 per mmBtu in New York.
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