NATGAS approaches key support

NATGAS plunged below $6MMBtu as weather forecasts for the US  predict higher temperatures over the next two weeks. Meanwhile Freeport is expected to postpone resumption of gas exports to the end of the year from mid-December, leaving more gas in the domestic market. On the supply side, average gas output in the US Lower 48 states jumped to a record 99.5 bcfd last month, up from 99.4 bcfd in October. At the same time, US officials are trying to prevent a railroad worker strike that could disrupt coal deliveries and force power generators to burn more gas. On the other hand, demand for LNG remains robust especially from Europe, which may limit the downward move. From a technical point of view, NATGAS price approaches key support at $5.72, which is marked with previous price reactions. Should break lower occur, downward move may accelerate towards October lows at $5.35.

NATGAS, H4 interval. Source: xStation5