Spot natural gas prices (CFDS ON NATURAL GAS) slightly decreased in recent trading at intraday levels. It recorded slight daily losses until the moment of writing this report, by -0.16%, settling at the price of $6.902 per million British thermal units. This happened after rising sharply yesterday by 3.83%.
Record natural gas prices in Europe and the United Kingdom jumped yesterday after Kremlin-run Gazprom warned that the remaining gas pipeline to Europe via Ukraine is now at risk of being shut down. This happened after damage to the Nord Stream natural gas pipeline from Russia to Europe rocked In the market.
Benchmark nearest-month futures in the Netherlands rose 10% to €205 per megawatt-hour on Wednesday, and UK gas futures for October were up nearly 26% to £321.67 per megawatt-hour.
US natural gas futures also closed higher in the wake of the oil rally, paring early losses, as traders kept their eyes on the impact of Hurricane Ian in Florida.
Hurricane Ian quickly intensified into a Category 4 storm that was expected to make landfall on Florida's Gulf Coast on Wednesday. The Bureau of Safety and Environmental Security reported Wednesday that in response to the storm 9.12% of oil production and 5.95% of natural gas production in the Gulf were shut down. However, that was less than shutting down 11% of oil production in the Gulf and 8.56% of natural gas production on Tuesday.
Natural Gas Technical Analysis
- Technically, natural gas, with its recent rise, is trying to compensate for part of what it incurred from previous losses, and at the same time it is trying to discharge some of its clear oversold by the relative strength indicators.
- Especially with the start of positive signals from them, considering the dominance of a bearish corrective wave in the short term, and it is affected by a negative technical structure.
- It formed earlier, which is the head and shoulders pattern, with the continuation of the negative pressure for its trading below the simple moving average for the previous 50 days.
Therefore, our expectations suggest the return of the decline in natural gas during its upcoming trading, to target the important 6.338. support level.
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