Natural Gas on the Nymex had a volatile week before closing 0.5% higher than the previous one at $1.68 for the April contract. EIA reported on Thursday another bearish draw of 60 Bcf in working underground stocks for the week ended February 16. Total Inventory is currently at 2,470 Bcf, 12% higher y/y, 22.3% above the 5-year average.

We have been selling rallies on exhaustion on the near-term charts for the past couple of months. The latest Daily MACD divergence offered a hedging opportunity as most of the market participants resumed some buying operations. Any spike is to be sold immediately during this post-winter downtrend until the end of the shoulder season. Our Puts have been in the money in the past few months. The working underground stocks remain above the 5-year maximum a month before the new injection season begins. We now need to identify on-time the seasonal floor for this market. Can these $1.00 contracts have this downtrend even prolonged throughout summer? I believe yes.

It is becoming increasingly clear that natural gas exports from the United States will not be what Putin's Western friends and partners imagined at the start of the war. Already in the spring of 2022, I analyzed that in the best-case scenario for the European Union, additional US natural gas exports would be only 10% of total U.S. domestic consumption. It is precisely for this reason that I note all this time that the main market for American natural gas producers is that of the domestic electricity generation. Europe already consumes 20% less natural gas compared to two years ago. The Spanish Megawatt-hour today is currently at a historic low of 6.72 Euros thanks to a faster transition to renewables and its current nuclear power output. Of course there is going to be volatility but the path is clear for more countries to walk through. Nuclear Energy Index is currently 34% higher y/y, the Nuclear Renaissance will make the output reach a historic peak in 2025. The Renixx index capping the 30 largest renewable companies also seems well stabilized lately.

U.S. macro data and the Dollar against majors must be routinely monitored. Daily, 4hour, 15min MACD and RSI are pointing to entry areas.

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