Saturday, December 16, 2017 10:16 AM EDT
Another trading day, another red candle for natural gas prices. That seems like the recent trend as the market continues to seek balance. Prices sold off over another 2.5% Friday, continuing below any short-term support level.
Traders are now eyeing just two final support levels before things get very ugly: $2.579, which is the low settle of the year (and which we seemed to bounce off of at $2.581 Friday), and $2.522, which is the absolute low of the year.
This comes on another day where the entire natural gas strip sold off in tandem, with losses only slightly larger at the front.
H/J declined just slightly on the day yet prompt month prices declined over 7 cents, an indication that this yet again was about far more than weather or any short-term factor, but rather an imbalance driven by elevated production levels.
This can be seen by the declines in natural gas calendar strips across the board over the last few weeks.
This had us warning clients mid-week that weather would likely not be in charge for a bit, with our Note of the Day on Wednesday featuring the below title.
This is one way we like to help add value for clients. While we publish detailed GWDD forecasts and break down the latest weather model guidance, indicating which way weather models are likely to ...
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This is one way we like to help add value for clients. While we publish detailed GWDD forecasts and break down the latest weather model guidance, indicating which way weather models are likely to trend, we also outline what we expect this means for the natural gas market, explaining when weather matters and when it does not. Our edge comes from weather; for our Trader subscribers, we publish Trade Alerts when we see a weather-driven opportunity to profit in the natural gas market. Yet our Trade Alerts are high confidence; everyone, since we launched them this summer, has been profitable, but we have not sent one out since the end of November.
Thus we like to look at ourselves as more than just a weather service; we analyze the natural gas market to demonstrate when the forecasts we create matter, and when there are other factors driving the market. Sometimes that results in a number of opportunities, but other times that results in few as we warn that there are other factors at play.Regardless, our clients always know what the role of weather is, and can position or size appropriately based on this weather-driven risk. To see exactly what we are talking about, try out one of our subscription services with a 10-day free trial here and see how we can help you better manage your weather-driven risk in the natural gas market.
Disclaimer: To begin receiving both our technical and fundamental analysis of the natural gas market on a daily basis, and view our various models breaking down weather by natural gas demand regions and various bullish/bearish risks, sign up for a 10-day free trial.
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