Natural gas up 0.54% to Rs 187.60 per mmBtu in the afternoon session

Natural gas futures rose to Rs 187.60 per mmBtu on April 9 as participants increased their long positions as seen by the open interest. Natural gas price had risen 0.1 percent on the NYMEX the previous day.

The commodity traded in the green after a gap-up start in the afternoon session. It has been trading higher than 5, 20 and 200-day moving averages but lower than the 50 and 100-day moving averages on the daily chart. The Relative Strength Index (RSI) is at 46.89, which indicates weak momentum in prices.

The US Energy Information Administration (EIA) reported that the country's natural gas inventories rose by 20 billion cubic feet (Bcf) for the week ended April 2 in line with market expectations. Natural gas in storage was 1,784 Bcf as of April 2, 2021.

According to the National Oceanic Atmospheric Administration, the weather is expected to become cooler than for most mid-west for the next 6-10 and 8-14 days.

Mixed factors have led to choppy trade in natural gas, however, the price has held near $2.5/mmBtu level.

“International natural gas futures have started flat this Friday morning and turned weak in the early afternoon in Asian trade. Technically, NYMEX Natural Gas could trade in a range of $2.35-2.65 levels,” Sriram Iyer, Senior Research Analyst at Reliance Securities said.  “Technically, MCX Natural Gas Apil hold support at Rs 184-181 levels whereas resistances are at Rs 188 and 191.”

MCX iCOMDEX Natural Gas Index was up 12.08 points or 0.50 percent to 2,429.87.

In the futures market, natural gas for April delivery touched an intraday high of Rs 188.60 and an intraday low of Rs 187.50 per mmBtu on MCX. So far in the current series, natural gas has touched a low of Rs 179.80 and a high of Rs 223.

Natural gas delivery for April gained Rs 1, or 0.54 percent, to Rs 187.60 per mmBtu at 14:46 hours IST with a business turnover of 15,647 lots. Delivery for May jumped Rs 0.90, or 0.46 percent, to Rs 194.50 per mmBtu with a business volume of 2,951 lots.

The value of April and May contracts traded, so far, is Rs 551.13 crore and Rs 19.57 crore.

Kshitij Purohit, Product Manager, Currency & Commodities, CapitalVia Global Research Limited, said, “Natural gas prices consolidated on Thursday, forming an inside day which is a sign of indecision. The movement followed an inline report from the Department of Energy which showed that natural gas inventories rose 20 Bcf. Resistance for the natural gas is at Rs 190 levels above it may come towards Rs 193 levels. Support for the energy is at Rs 185 level.”

Natural gas may continue to witness choppy trade, however, bigger than average buildup in stocks may keep pressure on prices. The US weather outlook, weekly rig activity report and trend in energy prices will be in focus during the day, Kotak Securities said.

At 09:20 (GMT), the natural gas price eased 0.32 percent quoting at $2.51 per mmBtu in New York.

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