NGI Archives | NGI All News Access
With Harvey Headed for Florida, Futures Head Lower
Despite stronger cash prices and the surprise formation of a newtropical system in the Gulf of Mexico over the weekend, natural gasfutures prices tumbled lower yesterday as traders continued toliquidate long positions. The October contract was the hardest hit,slipping 8.9 cents to finish at $2.519. With many Nymex localsobserving the Jewish Holiday Yom Kippur, estimated volume was heldto an extremely light 53,174 contracts.
“Disappointing,” was the word bulls used to explain the market’sdirection after Friday’s positive move. But news that TropicalStorm Harvey would miss completely natural gas production assets inthe Gulf of Mexico was too much for the market to overcome, traderssaid. Harvey was expected to pass over central Florida last nightand today, bringing heavy rains and winds of up to 45 mph.
However, a Gulf marketer warns that because Monday’s priceaction came on such low volume, prices could rebound Tuesday whenthe exchange is once again with its full complement of players. AWestern trader agrees and feels that anything in the $2.40s is agood buy. “People would be foolish not to lock in a portion oftheir winter requirements at those levels.”
But according to New York-based Thompson Global Markets, it’sonly going to get uglier for the bulls. “While natural gas futuresmanaged a modest upturn on Friday, we see the support for thismarket as fragile, and quite likely to crack under mountingfundamental pressure,” the group wrote in the NatGas Report datedSept. 20. In addition to an unimpressive weather outlook, TGM feelsthe storage report to be released this Wednesday will extend thedecline of the year-on-year surplus. “Our preliminary work suggestsnet injections of 70-90 Bcf are possible, outpacing the 52 Bcfrefill from a year ago.”
In daily techincals, support exists at $2.43 with resistancecoming in at last Thursday’s high of $2.64, a chartist said.
©Copyright 1999 Intelligence Press Inc. All rights reserved. Thepreceding news report may not be republished or redistributed, inwhole or in part, in any form, without prior written consent ofIntelligence Press, Inc.
© 2024 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 |