Natural Gas Tries To Settle Below $5.00

Key Insights

• Natural gas remains under strong pressure ahead of the weekend. 
• Gold rebounds as U.S. dollar pulls back. 
• Palladium tested support at $1950.

Natural Gas Keeps Moving Lower

Natural gas is down by more than 7% today as traders react to the recent EIA report, which indicated that working gas in storage increased by 111 Bcf from the previous week.

The weather forecast remains unfavorable for high natural gas consumption. Meanwhile, the European natural gas markets have moved towards multi-month lows. All in all, there are no upside catalysts for natural gas in the near term, so prices remain under significant pressure.

Natural gas managed to get below the support at $5.10 and is moving towards the next support level, which is located at $4.90. A successful test of this level will push natural gas towards the support at $4.75. If natural gas declines below $4.75, it will head towards the next support level at $4.50.

On the upside, the previous support level at $5.10 will serve as the first resistance level for natural gas. In case natural gas climbs back above this level, it will move towards the next resistance at $5.35. A move above $5.35 will open the way to the test of the resistance at $5.70.

WTI Oil Tested Support At $83.50

WTI oil made an attempt to settle below $83.50 but lost momentum and rebounded towards the $85.00 level.

In the near term, traders try to balance between recession worries and China stimulus hopes.

From a big picture point of view, WTI oil remains in a downside trend. The recent production cuts from OPEC+ provided temporary support, but recession fears have put significant pressure on oil markets.

In addition, the U.S. is selling oil from SPR. At some point, these sales may serve as a bullish catalyst as the amount of oil in SPR is decreasing.

Gold Rebounds As Dollar Moves Lower

Gold continues its attempts to settle back above the $1640 level as U.S. dollar pulls back ahead of the weekend. Treasury yields are moving higher, but gold traders ignore rising Treasury yields.

Silver rebounded towards the $19.00 level, while platinum moved back towards $920. Meanwhile, palladium found itself under signficant pressure and tested support at $1950.

Copper Attempts To Settle Above $3.45

Copper continued to rebound and moved towards the $3.45 level. The recent pullback in the U.S. dollar provided support to copper markets.

It should be noted that world copper inventories are at low levels, which may provide some support to the market. However, copper will still move lower in case recession risks materialize.

For a look at all of today’s economic events, check out our economic calendar.