Due to limited supply and stronger than usual demand caused by heat waves, the price of Natural Gas has been on the rise for 10 months. The August Nymex contract shed 6.3 cents day/day and settled at $3.637/MMBtu. The prompt month had advanced nine straight sessions prior to Tuesday — a span when robust cooling demand propelled prices. September fell 6.0 cents to $3.608 on Tuesday.
The latest weather outlook is still on par with the expectations, marking a hotter-than-normal temperature in a 15-day timeframe. “Most importantly, hot high pressure is expected to rule most of the U.S. July 17-20 and is likely to carry over to July 21-23 as well to keep weather sentiment bullish.”, stated by NatGasWeather. However, after a hot start this week, heavy rains are to be expected in the South, which will lead to cooler temperatures, thus reducing the demand for natural gas to generate electricity. With the ease in demand, the price of natural gas loses its upward momentum and ended its 10-months rally.
We love to hear new ideas from traders and want to know what you think!
If you like this topic and want to suggest future topics that you find helpful, let us know by clicking the ‘submit your feedback’ button below.
Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite.
Nothing contained in this website should be construed as investment advice. Any reference to an investment's past or potential performance is not, and should not be construed as, a recommendation or as a guarantee of any specific outcome or profit.