MCX Natural Gas has been in the grip of bears after Energy Information Administration came with a buildup of natural gas inventories and Nat Gas weather signaled for a moderate to low demand on account of cool shot freeze in Northern and Eastern U.S. Last week, Natural gas inventories failed to beat the expectations of the market and rose less than expected numbers as working gas in storage was leading to a total of 2,088 Billion cubic feet as of Friday, June 7, 2019, which represents a net increase of 102 Billion cubic feet from the previous week contrary to the expectations were for inventories to rise by 114 Billion cubic feet.
Natural Gas Inventories Forecast
As the weather is likely to be normal for next week and no storms are expecting in Atlantic. Bloomberg is expecting a range likely between 96 Bcf and 113 Bcf, and a median of 105 Bcf. Reuters has signaled for a range of 96 Bcf-115 Bcf, with a median of 105 Bcf. Natural Gas Intelligence is looking for a build of 105 Bcf.
Daily Technical Forecast
MCX Natural Gas prices tumbled this week as market participants were discounting the build-up of natural gas inventories along with sluggish demand that might stay due to cool weather. We are expecting a ‘Sell at rumor and Buy at fact’’ is going to take place after Energy Information Administration will come up with stockpiles data. On hourly scale, natural gas prices are moving back and forth making it a ‘Rectangle’ pattern. A breakout above the psychological resistance and upper portion of the pattern at 160 levels would activate the buyers for more upside. Stochastic oscillator and RSI are trading in an oversold zone.
Weekly Technical Forecast
On daily scale, the counter is trading below its strong support that is placed at 160.67 levels. Natural Gas inventories numbers will guide the direction of the counter as a closing above 161 levels would trigger the buyers for next week as a ‘Spring’ will be formed on the daily chart that will act as a selling climax. RSI is trading near 33.52 levels. Stochastic oscillator is trading in an oversold zone.