Asia stocks climb tracking Wall St rally; Nikkei hits record high, China GDP beats
Natural gas futures on the Nymex had a volatile week before closing 1.3% lower than the previous one at $3.02. EIA reported a draw of 54 Bcf in working underground stocks for the week ended March 20. Total inventory is currently at 1,829 Bcf, 5.2% higher y/y, 0.8% above the 5-year average.
Since the beginning of the Iran war, we said the downtrend would continue immediately afterward. Natural gas could not even bounce in the US despite the headlines and the lack of American determination to finish this off in a week with a larger budget and firepower. We have been selling rallies on exhaustion that keep coming our way since November. We want to operate on the near-term charts, taking any rally as a gift while trading the continuation of this post-winter downtrend towards a May floor of about $2.00. We do not want to become too complacent, though, as the US leadership seems not too assertive about any near-term exit from this war. So we do not want to trade the headlines for the longer term. We remain vigilant for any RSI and MACD entry point signal on the 2-hour charts. We do not want to marry any future contract at this point.
Allow me to make a more general comment based on events in the Middle East. The fossil fuel industry, of which President Trump has been the main salesman since 2016, now has a golden opportunity to show that it understands the change taking place on the planet in relation to energy. Instead of working for short-term gains on profit-making practices and policies, it should switch to other forms of energy at faster pace. It is now obvious that the planet does not need so much oil or gas. It does not take wars to prove the opposite. Any other practice will be characterized as nationally harmful and suspicious. The national security of countries will depend on it. My confidence in the end of the war lies in central banks and the cost of servicing public and private debt. The US economy is already faltering. Consumer confidence is too. I want to believe that in the coming weeks the war in the Middle East will be over. US macro data and the dollar index have to be monitored routinely. Daily, 4hour, 15min MACD and RSI are pointing to entry areas. 