Infinity Insights - Volume 11, Issue 17
AT-A-GLANCE SUMMARY
Spot month NYMEX natural gas (June) rallied to $3.00 resistance and stalled.
SUMMARY OF THE LAST WEEK IN CHARTS
Spot month natural gas (June) support is 2.75 with resistance at 3.10. Calendar year 2022 finds support at 2.70 with resistance at 2.85. Calendar year 2023 has support at 2.55 with resistance at 2.70.
Roadmap
NYMEX natural gas spot month (June) finished at $2.958 up $0.027.
Calendar 2022
Calendar 2022 closed higher by ≈$0.3 at $2.77.
Calendar 2023
Calendar 2023 settled at $2.60, ≈$0.015 up.
OUR TAKE ON THE MARKET
NYMEX Natural Gas
Spot month NYMEX natural gas (June) rallied to $3.00 resistance and stalled. The forward curve has moved to highs not seen since late August 2020. The tone is bullish. A contrary piece is open interest, which has grown at current levels, begging the question, “are short positions being built?”
Procurement on bulges can be troublesome. As we advocate, “buy weakness.” Without weather influences, a short position is a manageable risk for traders, so patience is recommended for procurement.
WHOLESALE POWER
ERCOT
Forward power prices increased by about $3/MW over the month of April. They were the beneficiaries of stronger natural gas and heat rates. Borrowing from the comments concerning natural gas price, above, there is a reasonable possibility for pullbacks from current levels.
PJM
Prices are near recent highs. They will most likely follow natural gas, therefore, patience may be a good idea until the $3 resistance is overcome.