August natural gas is set to open unchanged Wednesday morning at $3.08 as overnight near-term weather data changed little. Oil markets firmed.
“[Wednesday’s] six- to 10-day period forecast is warmer than yesterday’s forecast over portions of the southern and eastern U.S. But the north central U.S., Northwest and West Coast are cooler,” said WSI Corp. in its morning report to clients. “Some of these changes offset each other, so” continental United States population-weighted cooling degree days “are up 0.2 to 57.7 for the period, which are only 2.5 above average.”
WSI is confident of its predictions. “Medium range models are in reasonably good agreement with the break down and shift with the large scale pattern. There are some technical differences and inherent uncertainty with rain chances over the eastern U.S.”
Technical analysts are a bit leery that the current market strength is sustainable. “The RSI [Relative Strength Indicator] is a bit high, but no bearish divergence yet,” said Walter Zimmermann following Tuesday’s market close. He said that his first resistance point had already been reached in Tuesday’s trading and if the market can clear upwards of $3.10 then “room opens up” to upwards of $3.25. “All of these potential resistance points are candidates for a summer peak and the start of a sharp decline into the fall. So buyers beware.”
The Desk in its Early View Energy Information Administration storage sample late last week showed an average 33 Bcf from a survey of 10 analysts. This compares to last year’s 38 Bcf build and a five-year average of 59 Bcf.
The range on the survey was from 25 Bcf to 43 Bcf.
In overnight Globex trading August crude oil rose 12 cents to $46.52/bbl and August RBOB gasoline gained 2 cents to $1.5986/gal.
© 2020 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 |