It was another bloody day for natural gas bulls, with the February gas contract gapping down significantly and an early intraday bounce failing as well. The contract ended up settling down over 8% into options expiry.
(Click on image to enlarge)
The role of weather in the move was incredibly clear with the February contract logging by far the largest loss of the day.
(Click on image to enlarge)
This helped easily pull the March/April H/J spread to new lows.
(Click on image to enlarge)
Our Morning Update showed just how pronounced the GWDD losses were over the weekend, with most of them confined in the medium-range.
(Click on image to enlarge)
The Climate Prediction Center has been showing this more consistently too, with their Afternoon Update remaining quite warm through the 6-10 Day period.
(Click on image to enlarge)
In our Natural Gas Weekly Update for clients today we highlighted that it will easily hold the largest draw of the season so far with significant GWDDs last week.
(Click on image to enlarge)
Yet on a weather-adjusted basis, the print looks to be looser than last week, due in thanks to demand destruction from the Martin Luther King Jr. holiday last Monday.
(Click on image to enlarge)
Comments
Log in or sign up to join the conversation.