- May 20, 2020
- Posted by: Analysis Team
- Category: Forex News
CME Group’s preliminary prints for Natural Gas futures markets noted open interest shrunk for the second session in a row on Tuesday, this time by almost 3K contracts. Volume, in the meantime, went up for the second straight day, now by nearly 7.8K contracts.
Natural Gas Prices Forecast
The MMBtu of Natural Gas seems to have met decent resistance in the $1.76 mark so far this week. However, shrinking open interest is expected to prompt a correction lower in the very near-term scenario.
The rejection from the $1.76 region could trigger a return to the area of monthly lows around $1.56, where interim support is likely to emerge. If the 55-day SMA – today at $1.73 – is cleared on a sustainable fashion, then the next target of relevance is seen near $1.83, where sits the 100-day SMA. Further north emerges the 4-month peaks above $2.05 recorded in early May. The sustainability of further recovery is yet to be seen, however, as Natural Gas faces oversupply concerns, loss of demand and storage capacity close to its maximum levels.