Natural Gas futures on the Nymex had a positive week closing 7.9% higher than the previous one at $2.71 on Friday.

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EIA reported a build of 41 Bcf in working underground stocks for the week ended July 14. Total inventory is currently at 2,971 Bcf, 24% higher y/y, 13.8 % above the 5-year average. Both percentages have been coming down consistently during this refill season.

Another anticipated move from support level has been profitable for us. The same ranges have been giving multiple times the profit in the last few months, after we identified the seasonal floor, we have been buying any dip coming our way on the near-term charts on directional trading. Price remains very attractable, therefore the latest data on the gas-fired electricity generation demand have not taken us by surprise.  Allow me a broader comment about price competitiveness. Last year around May, we correctly anticipated that all future contracts were to face a sustainable downtrend. All this profiteering with the excuse of the Russian invasion in Ukraine, by producers, countries and major trading offices had to stop, if the commodity was to remain attractive for the largest markets in the world and play the long anticipated “bridge-fuel” role in the ongoing global energy transition. We had anticipated a floor at $3.50 back then, when the April ’23 contract was trading at $8.00. And here we are for the past few months not even bouncing back to $3.00 for the first two forward contracts in the latest shoulder season.

This is a nice lesson to be learned. The market has rules. And they are not written in ink by governments, producers, ship owners or truck drivers. Buyers also know how to write a contract. Taxpayers or voters can write a contract too, when talking about Democracies. They can also look for alternative channels or even substitutes.

Having said that, we still need to respect seasonality. Too many market participants will soon want to hedge their portfolios with some short-term use of this market on end-of-year trading. Therefore, we remain very much certain about this upcoming seasonal uptrend on larger trading volumes and less active rigs. But because of all the above, we need to remain humble and trade the near-term charts. The market is to become too technical, and spikes can turn tricky or even fair too quickly. We target $4.50 for the winter contracts, we trade the immediate forward option contracts for larger profits and hedging on real-time trading, the secondary market offers better spreads if we are to follow live the spikes.

U.S. macro data and the Dollar against majors must be routinely monitored. Daily, 4hour, 15min MACD and RSI are pointing to entry areas. Summer greets from one of the most beautiful islands in the world. Naxos in Greece.

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