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Natural gas futures on the Nymex had a negative week before closing 6.7% lower than the previous one at $3.61. EIA reported a bearish draw of only 38 Bcf for the week ended December 26. Total inventory is currently at 3,375 Bcf, 1.6% lower y/y, 1.7% above the 5-year average.

The pace of reduction has been bearish enough in the past few weeks, and the post-winter downtrend is already here.

We have remained cautious in our buying operations lately, and we managed to correctly predict that any pricing close to the $5.00 seasonal ceiling will be immediately sold. The price could not even spike for the past month. This is a fundamentally bearish sign for the months to come. We now want to see some kind of a bounce before selling again. The last resistance level has to be the $4.00, as support at $3.50 is looking strong enough for now. I believe that this same range will offer another selling opportunity in the coming weeks. All spring put options have already been in the money. We do not want to be too greedy about this downtrend, as we are only in early January. Selling rallies on exhaustion on the near-term charts is what we are going to do for another few months until the end of the next shoulder season. The same ranges can give multiple times the profit until then.

The events in Venezuela are very serious. For the immediate future, I believe that the price of crude oil will not be affected much. The technical issues are not immediately solvable. It remains to be seen whether President Trump's choice is in line with the wishes of American oil companies. Whether they really want to develop one of the world's largest deposits in the world. The US remains thirsty for the heavy crude, but the global oil market environment is not the same as it was 30 years ago. Of course, President Trump, already with his policy on international trade and tariffs, as well as his failure to choose to develop other forms of energy, has shown that his economic thinking is much further back than just 30 years. It is probably 4 centuries behind. The overly optimistic view of a president, that the world does not change and industries should not adapt to new technological facts that improve human evolution, is an immediate threat, primarily to the national security of the United States and, by extension, to the entire Western world. The latest data from the US labor market, as well as from the housing market, does not seem to be very reassuring for the domestic demand of the coming months. Daily, 4hour, 15min MACD and RSI are pointing to entry areas. 
 

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