Wednesday, December 05, 2018 at 4:34PM
While American equity and interest rate markets were closed today, NYMEX natural gas futures had a normal day with seemingly normal levels of volatility, though volume was off a bit on the day. After an overnight bounce prices settled up just over a cent on the day, seeing another decent trading range of over 22 cents. The March contract again led the day today. Even so, in our Morning Update for clients we highlighted that the F/H January/March spread was just barely off highs. We also outlined a "Neutral" sentiment today but highlighted that on the day the January contract appeared "overvalued" over the $4.5 level despite small overnight GWDD adds that were supporting prices. Sure enough, prices pulled back to flat on the day, thanks in part to a warmer run of the afternoon GEFS in the long-range relative to the overnight run (images courtesy of Tropical Tidbits). Meanwhile, we can see the volume drop-off today that resulted from other American financial markets being closed today, with just over 97,000 prompt month gas contracts being traded in today's session. It will be mostly back to normal tomorrow, though the weekly EIA natural gas storage change number has been moved back a day to Friday at 10:30 AM Eastern. Traders are generally looking for a storage change similar to what we saw last week with GWDDs near constant week-over-week. In our research today we outlined a number of key weather trends for clients, primarily how intense warmth in Weeks 2 and 3 will be and when it looks to end and reverse back colder. We outlined potential impacts on natural gas prices, as well as how tight balances are running in this current cold shot and how that will impact next week's EIA print as well. To give all this research a look, try out a 10-day free trial here.