Table Daily
natural gas decline has stalled while prices have rebounded significantly from the Monday low of 4.176 to 4.278 per million Btu of power. This increase came despite better than expected weather forecasts which provides that the cold weather to be replaced by the milder climate. Temperature should be in New York to around 29 degrees Fahrenheit lower at the end of January - 2 degrees above normal. Prices have been largely driven by higher demand (49% of US households burn gas to heat) in recent weeks, the additional demand resulting in inventory record low according to data provided by the Energy report information Administration.
Therefore, with the worst of the winter should be over soon, it is surprising to see natural gas managing to keep most of its gains. It seems that everyone has forgotten why Nat Gas has been dubbed the Widow Maker ago barely 5 years - levels of Nat Gas production has always been healthy for less, and when demand begins to fall in the approach of spring, there will be little to keep current bull trend
Thus is the market being irresponsibly optimistic again
well, the current market price is not the most optimist -.? we still trading below the 4.34 resistance level where previous peaks of 14 December and 8 January were seen. These two peaks and the high made in 2013 just before Christmas would have formed a head and shoulders pattern perfect if not for the record inventory drawdown spoil the party. Although prices have since rebounded, that 4.34 remains suggest that the downward pressure provided by the H & S pattern is not completely invalidated.
The only thing that keeps prices afloat at the moment is the neckline of the H & S pattern, but generally necklines are not the strongest levels of support and suspect that the price has unable to break the neck as there were not many ongoing negotiation due to the US party - volume was a mere 1 / 5th of average 100 days. As such, do not treat the holding of the neckline as a sign of support strong bullish, as prices can still negotiate even lower today during normal trading resumes
Connections:.
GBP / USD - 1.6450 resistance Grand Stands
AUD / USD - Trying to hold above 0.88
EUR / USD - 1.3550 Settles Around
This article is only for general information purposes. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or its subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
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