Infinity Insights – Volume 8, Issue 26

AT-A-GLANCE SUMMARY

Spot month NYMEX natural gas (August) sold off to support in low $2.70s and has held.

SUMMARY OF THE LAST WEEK IN CHARTS

Spot month natural gas (August) has support at 2.70 then 2.60 with resistance at 2.88. Calendar year 2019 has support at 2.67 with resistance at 2.72. Calendar year 2020 has support at 2.60 with resistance at 2.65.For a look at our monthly market reports, visit Infinity Power Partner’s Market Overview.

Roadmap

NYMEX natural gas spot month (August) settled at $2.757, up $0.005.

1

What’s This? – The “Roadmap” is the price action chart depicting the NYMEX natural gas spot month. It’s important because it is essentially the trading community’s market sentiment.

Cal 19

Calendar 2019 settled at $2.708, off by ≈$0.0225.

2

What’s This? – “Cal 19” is the first complete 12-month strip. It gives you a visual of price action and provides a reference point for our take on the market.

Cal 20

Calendar 2020 closed at $2.6075, down ≈$0.05.

3

What’s This? – “Cal 20” is the second complete 12-month strip. It gives you a visual of price action and provides a reference point for our take on the market.

OUR TAKE ON THE MARKET

Spot month NYMEX natural gas (August) sold off to support in low $2.70s and has held. Noteworthy is the key reversal occurring Thursday (higher highs, lower lows, higher close). Trade remains orderly and boring. Calendar strips are defensive with deferred years’ subtlety making new lows.

ERCOT’s Summertime Issues

It’s hot in Texas and forecasted to remain so well into August. The buffer of additional resources (generation, demand response, etc.) is not large and adds nervousness to decisions. Already, records are being broken. The durability of the grid is challenged by the length of this heat wave. LMP prices are rising and economic delivery is harder to depend on. Hopefully, most loads have found ways to mitigate hiccups. If one hasn’t, and is considering LMP, comparisons between floating and fixing is step one. Recent averages for LMP are in the low $30s but some days are above $100. Fixed prices are high, so if we had done nothing, we would probably float.