Another opinion on Nat Gas

June 17th, 2009 at 5:26 pm
Hi Sunil. Nice pop in natural gas during the past week. Lots of technical analysts have commented favourably during the past week. Ironically, short term momentum indicators (e.g. Stochastics) already have reached a shor term overbought level. Seasonal influences turn postive in August. Fundamentals remain dreadful due to large and growing inventories. Storage capacity already is approaching the full level. Not surprising, several companies including Encana and Chesapeake have announced production cut backs. Cooler than average weather this spring and projected until fall means lower demand. There are several interesting seasonal plays lining up this summer based on technical and fundamental prospects. Natural gas currently is not on the list.
-Don Vialoux, DVTechTalk