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Natural Gas Fundamental Forecast – February 11, 2016

By:
James Hyerczyk
Published: Feb 10, 2016, 14:24 UTC

Analysis and Recommendations: March Natural Gas futures finished at 2.080, down -0.18 or -0.86%. Traders have fully priced in the expected blast of cold

Natural Gas Fundamental Forecast – February 11, 2016

natural gas wednesday Jim
Analysis and Recommendations:

March Natural Gas futures finished at 2.080, down -0.18 or -0.86%. Traders have fully priced in the expected blast of cold air currently hitting the major demand areas and are already looking beyond it while beginning to factor in the possibility of another price drop below $2.00 once the cold subsides.

Warm temperatures this winter have limited natural gas demand across the country. Even with a near-term weather event, the market couldn’t rally much. This suggests that the next bearish weather forecast could prompt another break below the psychological $2.00 level.

Natural gas production continues to rise and is near a five-year high. The forecasts for the remainder of the winter continue to track below normal. All of these factors add up to a bearish scenario.

The traditional fundamentals suggest the supply glut is likely to continue so gains are likely to be limited, with fresh short-sellers targeting another break below the $2.00 level. Bottom-pickers are likely to continue to come in to defend this area, but unless there is a lingering cold snap in the forecast, they are not likely to drive out the wave of selling pressure currently hitting the market.

Natural Gas Weekly Weather Outlook

Feb 10-16th: A strong weather system and associated cold blast now covers the eastern US with below normal temperatures and areas of light to moderate snowfall, especially near the Great Lakes. Another colder reinforcing Polar outbreak will impact the Midwest and Northeast Friday through the coming weekend with very cold temperatures. This will drop lows into the single digits and below zero over the Midwest, Mid-Atlantic, and Northeast. Texas and the West will remain mostly dry and mild with above normal temperatures and highs in the 50s to 70s. Overall, nat gas demand will be HIGH.

FxEmpire provides in-depth analysis for each asset we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports, which covers the current week and are published by Sunday before the new week begins. Daily we share any new events, forecasts or analysis that affect the current day. To achieve a full accurate understanding it is important that you study all of our data and analysis as a whole.

WEEKLY

Natural Gas Weekly Update
Release Schedule: Thursday between 2:00 and 2:30 p.m. (Eastern Time)

Weekly Natural Gas Storage Report

Release Schedule: Thursday at 10:30 (Eastern Time) (schedule)

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30-Minute Natural Gas

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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