This month US natural gas futures reached levels not seen since November, as plunge in temperatures across the Great Plains from Canada to Texas, resulted in higher demand for gas and electricity from the residential and commercial sectors. Further supporting prices was lack of reserves as generators in Texas, the largest US gas producer, are paid only for the energy that they sell, not for keeping capacity in reserve for times of stress. Over the weekend frigid temperatures caused equipment failures, temporarily shutdowns in at least four natgas plants. Temperatures across Texas and the central US are expected to be well below normal through the end of the week.
NATGAS - price broke above major resistance at $3/MMBtu as cold temperatures restricted gas flow from wells to pipelines, helping to spark a jump in prices. As long as the price sits above $3/MMBtu, one should expect the price to continue to rise. Breaking below this area will invalidate the bullish scenario and downward move may accelerate towards support at $2.70/MMBtu. Source: xStation5
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