- The price of Natural Gas shows no signs of fatigue and is close to the 2024 high.
- Brussels is discussing keeping gas flows from Russia open for next year.
- The US Dollar Index is near 105.00 ahead of Wednesday’s CPI and Fed meeting.
The price of Natural Gas (XNG/USD) trades higher on Tuesday, approaching a new yearly high, as Europe discusses ways to maintain flows through Ukraine next year and amid a surge in supply from Norway. While Norwegian flows are at their highest levels since April, Europe is looking to talk to Ukraine and Russia to maintain the flow of Gas. This opens a wound for Europe after it pledged to ban Russian gas. With great uncertainties now over whether Europe can even become independent from Russian Gas, prices are rising as traders predict that Europe will need to buy more Gas if Russia or Ukraine refuse to reach a deal.
Meanwhile, the US Dollar Index (DXY), which tracks the value of the greenback against six major currencies, remains above 105.00 in a very calm start to the week. The DXY moved a bit on Monday due to the result of the European elections, although the movement has calmed down now. It seems that traders will wait for the main events on Wednesday, with the release of the Consumer Price Index (CPI) and the decision on the Federal Reserve (Fed) rates and the dot chart.
Natural Gas is trading at $3.07 per MMBtu at the time of writing.
News and drivers of the Natural Gas market: Australia, an obstacle
- Bloomberg reports that Chevron has stopped all gas production at its Wheatstone offshore facility in Australia to complete fuel system repairs. Production was already suspended on Monday.
- Ukraine’s state gas company Naftogaz says it sees substantial interest from Europe to tap into its gas reserves and facilities, Reuters reports.
- Europe is considering bypassing Ukraine if Kyiv does not want to cooperate with a European-Russian Gas deal. One option under consideration is to divert gas flows from Ukraine to Azerbaijan toward Europe, Bloomberg reports.
Technical analysis of Natural Gas: Is the third time the charm?
Natural Gas is trading higher, printing a fifth consecutive green daily candle. Although there could be more upside, the current level is a strong limit that will not be easy to overcome. If this $3.07-$3.10 barrier is broken, a quick rally to $3.50 could be on the table.
The crucial level near $3.07 (6Mar 2023 high) remains key as prices failed to close above it. Add the red descending trend line reaching $3.12, which would stop any attempt to go higher. Higher up, the new year-to-date high at $3.16 is the level to beat.
On the downside, the 200-day SMA acts as the first support near $2.53. If that support area does not hold, the next target could be the crucial level near $2.14, with intermediate support by the 55-day SMA near $2.34. Further down, the major support lies at $2.11 with the 100-day SMA.
Natural Gas: Daily Chart
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
