Natural gas futures on the Nymex faced a negative week before closing on Friday 14.2% lower than the previous one at $3.90. EIA confirmed on Thursday another large draw nonetheless of 222 Bcf in working underground stocks for the week ended Feb. 4. Inventory is currently at 2,101 Bcf, 17.3% lower y/y, 9.3% below the 5-year average. Both percentages have moved down quickly in the past month.
We had been anticipating these last two seasonal gifts on colder weather across most parts of the Lower 48. The post-winter downtrend will continue for another couple of months, but not with the same aggression.
We are going to sell any bounce or rally coming our way on near term charts until the May contract. Support at $3.30 is going to be tested on our way to lower lows.
The U.S. gas market is now showing responsibility in pricing policy, making the U.S. benchmark even more export-friendly at a time when allied countries need it most. We've argued many times over the last four years that the future of American natural gas will only be bright if it is economically viable for consumers and solves the problems of methane emissions.
The domestic market is really important and the gas-fired electricity generation market share will have to be preserved at all costs. Pricing is going to be its best marketing tool.
U.S. macro data and the Dollar Index should be monitored routinely.
U.S. consumer sentiment unexpectedly slumped to a 10-year low. This was happening at a time of almost full employment, just moments before the FED raises interest rates to fight a 40-Year high inflation level, for which fossil fuels are largely responsible.
Daily, 4hour, 15min MACD and RSI are pointing to entry areas. 