Natural Gas Corner - Commitment of Trader's Report - Natural Gas

The fund long position in natural gas nearly doubled two weeks ago as the market rallied higher by over 40%.

The position fell slightly last week according to the holiday-delayed Commitment of Trader's report released on Monday.

The current fund position in natural gas (futures only) as of last Tuesday's close was estimated at 40,432 contracts by the report, down 2,946 from the previous week.

Not much to glean from this report other than the willingness for the funds to jump back into this market on the long side on any sign of the market bottoming.

Natural Gas Corner - Market Update - What An End To 2015 !!!

The final two weeks of 2015 show why natural gas is one of the most volatile commodities on earth as the spot price rallied higher by .703 or 42% over 6 days of trade.

Winter weather finally arrived to the eastern U.S. quickly reversing market prices which had reached a 14-year low in mid-December.

December temperatures in the U.S. turned out to be the warmest on record shattering the previous record in terms of heating degree days by 15%. Current gas in storage is 3,756 Bcf (billion cubic feet) remains at an all-time high for this time of year.

With roughly 12 weeks to go in this current winter, demand is going to have to increase to keep storage from reaching a withdrawal season high by the end of March.  Winter demand is rising as weather forecasts have turned markedly colder particularly in the high usage Midwest and northeastern sections of the U.S. 

Natural gas production also fell in the latest EIA report and could be a bullish factor later this year.

Recent strength could have marked a long term low in the natural gas market.  A pullback in retest of downside support is now expected but talk of the market setting new lows at this point in the face of increased heating demand seems premature.  The first sell off from last week's high should be bought.

If new lows are set in natural gas, it will likely be toward the end of winter which finally appears to be starting.

Latest 6-10 and 8-14 Day National Weather Service Forecasts

Dow Jones - Natural Gas Slips As Traders Focus On Oversupply

DJ Natural Gas Slips as Traders Focus on Oversupply


   By Nicole Friedman


  NEW YORK--Natural-gas prices fell Monday on continued concerns about oversupply.

  Prices wavered between gains and losses throughout the session as traders weighed expectations of increased
consumption in the coming weeks against currently ample inventories of the fuel.

  Warmer-than-average temperatures in recent months have cut demand for indoor heating in homes and offices, helping
push the natural-gas market into oversupply. About half of U.S. households use natural gas as their primary heating
fuel.

  Forecasts for the next two weeks call for colder weather in the central U.S., according to WSI Corp.

  "The return of cold weather brings back price volatility," said Citigroup Inc. analysts in a note. "U.S. gas has a
history of delivering surprises due to sharp turns toward colder weather."

  However, "the first major cold air of the season that is expected to envelop most of the country next week has been
largely priced in," said energy-advisory firm Ritterbusch & Associates in a note.

  Natural gas futures for February delivery settled down 0.3 cent, or 0.1%, at $2.334 a million British thermal units
on the New York Mercantile Exchange.

  Raymond James analysts lowered their natural-gas price forecast for 2016 to $2 a thousand cubic feet, down from their
prior forecast of $2.35/mcf. This is the bank's third forecast cut since August.

  "The U.S. gas market has been structurally oversupplied for years. We expect the glut to persist in 2016," the bank
said.

      FUTURES       SETTLEMENT      NET CHANGE
   Nymex February    $2.334             -0.3c
   Nymex March       $2.350             -1.3c
   Nymex April       $2.373             -1.4c
   CASH HUB           RANGE             PREVIOUS SESSION
   El Paso Perm    $2.33-$2.425          $2.35-$2.4525
   El Paso SJ      $2.35-$2.50           $2.40-$2.52
   Henry Hub       $2.32-$2.415          $2.285-$2.35
   Katy            $2.35-$2.40           $2.28-$2.39
   SoCal           $2.50-$2.65           $2.51-$2.63
   Tex East M3     $3.00-$4.00           $1.50-$1.75
   Transco 65      $2.3725-$2.41         $2.23-$2.38
   Transco Z6      $6.00-$9.00           $2.90-$3.20
   Waha            $2.37-$2.41           $2.36-$2.44


  Write to Nicole Friedman at nicole.friedman@wsj.com


  (END) Dow Jones Newswires

  January 04, 2016 15:21 ET (20:21 GMT)

  Copyright (c) 2016 Dow Jones & Company, Inc.

010416 20:21 -- GMT
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Dow Jones - Natural Gas Falls Despite Colder Forecast

DJ Natural Gas Falls Despite Colder Forecast


   By Nicole Friedman


  NEW YORK--Natural-gas prices slid Monday on continued concerns about oversupply.

  Warmer-than-average temperatures in recent months have cut demand for indoor heating in homes and offices, helping
push the natural-gas market into oversupply. About half of U.S. households use natural gas as their primary heating
fuel.

  As of Dec. 25, natural-gas inventories stood 14% above the five-year average level for this time of year.

  Forecasts for the next two weeks call for colder weather in the central U.S., according to WSI Corp. "With colder
weather on tap for the next few days, the market looks to remain a bit on the firmer side," said Frank Clements,
co-owner of Meridian Energy Brokers Inc., in a note.

  But the forecasts aren't cold enough to spark a price rally, analysts say. "Risks of new price dips remain
significant, in our view," said Seaport Global Securities LLC in a note.

  Raymond James analysts lowered their natural-gas price forecast for 2016 to $2 a thousand cubic feet, down from their
prior forecast of $2.35/mcf. This is the bank's third forecast cut since August.

  "The U.S. gas market has been structurally oversupplied for years. We expect the glut to persist in 2016," the bank
said.

  Physical gas for next-day delivery at the Henry Hub in Louisiana last traded at $2.375/mmBtu, compared with
Thursday's range of $2.285-$2.35. Cash prices at the Transco Z6 hub in New York last traded at $7.52/mmBtu, compared
with Thursday's range of $2.90-$3.20.


  Write to Nicole Friedman at nicole.friedman@wsj.com


  (END) Dow Jones Newswires

  January 04, 2016 10:47 ET (15:47 GMT)

  Copyright (c) 2016 Dow Jones & Company, Inc.

010416 15:47 -- GMT
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Natural Gas Corner - Technical Update - Market Surges By Over 30% In 6 Days

The February 16 natural gas contract gained .584 or 32.4% over 6 days beginning at the 1.802 contract low up to last week’s 2.386 high.

The  market trended sideways over the last two days of 2015 with the February contract settling Thursday at 2.337.

The trend has turned up following the breakout above the 10 and 40 day moving averages.  The 40 day moving average at 2.260 is the first area of support today followed by the 10 day average at 2.145.  A close under both averages will  turn the trend back down.

Last week’s 2.386 high is the first area of resistance with a breakout  above this level turning 2.580-2.600 into the next longer term resistance.

Technical Indicators:  Moving Average Alignment – Neutral-Bullish

                                         Long Term Trend Following Index – Bearish

                                         Short Term Trend Following Index - Bullish

MDA Earthsat 15 Day Forecast - Widespread Cold In The East