Natural gas futures advanced to Rs 215.70 on May 21 as market participants rolled over their long position as seen by the open interest. The gas prices declined 1.3 percent on May 20 on the NYMEX as EIA weekly report missed market expectations.
On the Multi-Commodity Exchange (MCX), natural gas delivery for May rose by Rs 2.10, or 0.98 percent, to Rs 215.70 per mmBtu at 15:01 hours IST with a business turnover of 7,189 lots.
Natural gas delivery for June gained Rs 2.20, or 1 percent, to Rs 221.20 per mmBtu with a business volume of 11,100 lots.
The value of May and June’s contracts traded so far is Rs 333.46 crore and Rs 359.99 crore, respectively.
MCX iCOMDEX Natural Gas Index soared 25.76 points or 0.96 percent to 2,712.17.
Sriram Iyer, Senior Research Analyst at Reliance Securities, said, “International natural gas futures are trading higher in the early afternoon in Asian trade. Technically, NYMEX Natural Gas trade in a range of $ 2.90-3.10 levels.”
On the MCX, Natural Gas May could see a sideways to marginal downside momentum in the coming session where Rs 216-Rs 219 levels will hold resistance and support is at Rs 211-Rs 209 levels,” Iyer added.
The US Energy Information Administration (EIA) reported that the country’s natural gas inventories increased by 71 billion cubic feet (Bcf) for the week ended May 14 as against market expectations for a build of 67 Bcf. Natural gas in storage was 2,100 Bcf as of May 14, 2021.
As per the National Oceanic Atmospheric Administration, the weather is expected to be warmer than normal for most of the East Coast and Mid-Atlantic for the next 6-10 and 8-14 days.
Natural gas has eased back after testing a three-month high but the price has re-entered the $ 2.9-3/mmBtu range seen for the last few days. “We may see price consolidating in a range; however, increasing focus on summer-related demand buying may emerge at lower levels,” said Kotak Securities.
Technicals
The commodity has been trading higher than 50, 100 and 200 days’ moving averages but lower than the 5 and 20 days’ moving averages on a daily chart. The momentum indicator Relative Strength Index (RSI) is at 52.31, which indicates a neutral movement in the price.
At 09:46 (GMT), the natural gas price was up 0.92 percent quoting at $ 2.95 per mmBtu in New York.
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