Infinity Insights-Volume 10, Issue 29

AT-A-GLANCE SUMMARY

August NYMEX natural gas expired on Wednesday, rallying to 1.90.

SUMMARY OF THE LAST WEEK IN CHARTS

Spot month natural gas (September) has support at 1.70 with resistance at 2.00.
Calendar year 2021 finds support at 2.60 with resistance at 2.75. Calendar year
2022 has support at 2.40 with resistance at 2.55.

Roadmap
NYMEX natural gas spot month (September) closed at $1.799, $0.068 lower
versus the close of July 24.

Cal 2021
Calendar 2021 finished at $2.6875, ≤$0.05 higher versus last Friday.

Cal 2022
Calendar 2022 settled at $2.53, ≤$0.05 better versus last Friday.

OUR TAKE ON THE MARKETS

NYMEX Natural Gas

August NYMEX natural gas expired Wednesday, rallying to 1.90. Short covering appears to be part of the move. September (new spot month) followed, rallying to 1.90+. Thursday saw no follow-through, reinforcing our short-covering perspective. 2.00 is a significant technical point and penetration would cause a reevaluation of what appears to be 1.70 to 2.00 range of trading for spot NYMEX.

The more important pricing for procurement are the calendar strips, particularly 2021 and 2022. They joined the rally to their major resistance points at 2.75 and 2.55, respectively. Our opinion is that, without weather demand, a pullback is in the cards. Watch these levels for indications of that view (and indications of contradictory tells).

WHOLESALE POWER

ERCOT

Heat rates have moved in an inverse pattern of pricing, with calendar strips 2021 through 2025 prices close to each other.

This configuration has sometimes preceded directional moves. In any event, wholesale power pricing has been tempered.

PJM

PJM pricing continues to follow natural gas, remaining steady.

Stay Safe!