Natural Gas Season is Going to Start!
Fundamentals Reasons for Natural Gas Buying:
Russia-Ukraine war and Europe Energy crises:
Russia has continued to escalate economic pressure on Europe with the shutting down of the Nord Stream 1 gas pipeline. The European Union receives about 40% of its natural gas from Russian pipelines and about a quarter of that flows through Ukraine. Germany gets roughly half of its natural gas from Russia.
China agrees to pay for Russian Gas:
The move is beneficial for both countries -- China is able to secure cheaper supply and resell shipments from more expensive exporters to utilities in Europe and Asia, while Russia can continue selling fuel at a profit. Japan and South Korea, traditionally the top destinations for Sakhalin LNG, have stopped buying spot shipments from the plant since Russia invaded Ukraine in February.
Winter Season and Demand factor:
In the winter demand for natural gas is at an all time high because the majority of U.S. homes have heating systems that use it as a power source. If temperatures remain low the increased demand could last into early Spring. Demand gets so high in winter, the U.S. imports natural gas from Canada, Trinidad and a few other countries.
Gas prices could target next technical range of $8.60-$9.70
As you can see in Daily TF Gas shows some bullish momentum and prices still prevailing above 100 EMA. Moreover, Crossover of 20EMA and 50EMA shows me a Bullish bias.
Current Price= $8.550 (MMBTU)
Buying Range from 8.550 to 7.980
Initial Target = 8.980
2nd Target = 9.710
3rd Target = 10.400
StopLoss= 7.600
Russia-Ukraine war and Europe Energy crises:
Russia has continued to escalate economic pressure on Europe with the shutting down of the Nord Stream 1 gas pipeline. The European Union receives about 40% of its natural gas from Russian pipelines and about a quarter of that flows through Ukraine. Germany gets roughly half of its natural gas from Russia.
China agrees to pay for Russian Gas:
The move is beneficial for both countries -- China is able to secure cheaper supply and resell shipments from more expensive exporters to utilities in Europe and Asia, while Russia can continue selling fuel at a profit. Japan and South Korea, traditionally the top destinations for Sakhalin LNG, have stopped buying spot shipments from the plant since Russia invaded Ukraine in February.
Winter Season and Demand factor:
In the winter demand for natural gas is at an all time high because the majority of U.S. homes have heating systems that use it as a power source. If temperatures remain low the increased demand could last into early Spring. Demand gets so high in winter, the U.S. imports natural gas from Canada, Trinidad and a few other countries.
Gas prices could target next technical range of $8.60-$9.70
As you can see in Daily TF Gas shows some bullish momentum and prices still prevailing above 100 EMA. Moreover, Crossover of 20EMA and 50EMA shows me a Bullish bias.
Current Price= $8.550 (MMBTU)
Buying Range from 8.550 to 7.980
Initial Target = 8.980
2nd Target = 9.710
3rd Target = 10.400
StopLoss= 7.600
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