Infinity Insights-Volume 10, Issue 11

AT-A-GLANCE SUMMARY

Coronavirus, with its real and imagined consequences, dominates virtually every aspect of our lives.

SUMMARY OF THE LAST WEEK IN CHARTS

Spot month natural gas (April) has support at 1.55 with resistance at 1.75. Calendar year 2021 finds support at 2.25 with resistance at 2.40. Calendar year 2022 has support at 2.35 with resistance at 2.42.RoadmapNYMEX natural gas spot month (April) ended lower by $0.265 at $1.604.Calendar 2021Calendar 2021 settled ≤$0.025 better at $2.38.Calendar 2022Calendar 2022 ended the week at $2.35, up ≈$0.01.

OUR TAKE ON THE MARKET

NYMEX Natural Gas

Coronavirus, with its real and imagined consequences, dominates virtually every aspect of our lives. Natural gas is reacting more in a “do nothing stupid” environment than making a position stand, either bullish or bearish. Open interest continues to drop.After the first week of COVID-19 protocols, prices in spot NYMEX natural gas are at important technical levels, something that doesn’t carry the significance it would in “normal” times. That’s really the point: we’ve never been here before and aren’t sure of where things go from here. For physical use of fossil fuels, transactions happen; for speculative ventures, probably not so much.

IPP’s stance is to provide our clients’ with advice and action as needed. We are in place and prepared for a long time out. We counsel that you do the same.

WHOLESALE POWER

ERCOTPower prices remain static with heat rates off the highs and looking toppy and natural gas off the lows (past spot values) without features other than liquidation. Real-time prices (LMP) have firmed into the mid-20s, something to watch. The risk of the unknown encourages action if power procurement needs to happen.PJMPower prices continue to follow natural gas and remain low. The risk of the unknown encourages action if power procurement needs to happen.