Oil and Gas steady in early trading

This morning, oil prices have taken positive cues from this optimistic market ahead of US consumer confidence index which is likely to increase after Fed monetary easing. However, the down grade of  the Asian Pacific region by credit rating agency S&P is limiting gains and weighing on regional market. On the other side, increasing crude oil production and import may add more stock piling of crude oil in US. Rising refinery capacity may increase petroleum stocks. However, concern of declining gasoline demand is likely to pressurize oil prices. Talk of releasing strategic reserve before presidential election in order to keep gasoline price lower is another factor to weigh on crude oil prices. In the US the Obama administration has said that the Iran state oil company’s is involved in nuclear program, ahead of tomorrow’s speech of Iran President on Iran Nuclear program, oil futures prices may remain volatile.

Yesterday, Nymex Crude-oil futures retreated after several reports underscored sputtering economic growth in some of the world’s biggest oil consumers, raising fresh concerns about demand. Crude oil has been especially volatile in recent weeks. Traders bought crude last week on the hope that a resolution of the debt crisis in Europe will increase economic activity and demand for oil.

This weekend’s argument between the leaders of France and Germany has popped that hopeful bubble. Press reports out of Asia indicate that growth in China is slowing down faster than previously thought. Widespread protests over a territorial dispute with Japan have disrupted production at many Japanese-owned factories in China while the ongoing leadership transition has suffered a few bumps along the way which have increased the overall level of uncertainty in China. This has added to negative sentiment on oil. Negotiation talk between China and Japan are scheduled for today in order to resolve the Island dispute. South Korea has declared to lower its fiscal deficit by increasing its spending 3 percent for 2013 budget.

In the eurozone, the IMF has said that Greece is not going to ease its debt crisis soon due to delay in recapitalization and weakening economy. The Spanish stress tests are due this week and the euro is likely to remain under pressure which may ultimately weigh on oil prices.

This morning natural gas prices are trading above $3.00/MMBTU with gain of more than 1 percent. The National Hurricane Center reports that, tropical storm Miriam has reached category 2 level of Hurricane near to PADD IV region accounts for more gas production in US. MDA Earth Sat, another leading weather forecaster, said the 6 to 10-day forecast period would see cooler temperatures. Speculation of rising demand for space heating purpose may support gas prices to trade on higher side along with hurricane warnings.

Natural Gas Forecast September 25, 2012, Technical Analysis

The natural gas markets fell during most of the session on Monday, but bounced off of the three dollars level in order to find some support in form a hammer for the session. We have been out of this market recently, and as such we feel that this market is best avoided right now as it does look very choppy indeed. Granted, we have a longer-term downtrend in effect, but the truth is that we have seen quite a bit of resilience by the bulls lately.

Ultimately, we feel that this market will continue to fall over time but we aren’t willing to put any money into it at this moment in time as the volatility is essentially chopping traders up right now.

 

Natural Gas Forecast September 25, 2012, Technical Analysis
Natural Gas Forecast September 25, 2012, Technical Analysis
 

Natural Gas Fundamental Analysis September 25, 2012 Forecast

Analysis and Recommendations:

Natural Gas is trading at 3.015.The National Hurricane Center reported that tropical storm Miriam has reached the level of Hurricane near to PADD IV region accounts for more gas production in US. MDA Earth Sat, another leading weather forecaster, said the 6 to 10-day forecast period would see cooler temperatures. Thus, speculation of rising demand for space heating purpose may support gas prices to trade on higher side.

The number of rigs actively exploring for oil and natural gas in the US dropped last week by 5 to 1,859. 1,402 rigs were explored for oil and 454 were searching for gas while 3 were listed as miscellaneous, as per oil-field services company Baker Hughes Inc.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Economic Data September 24, 2012 actual v. forecast

Date

 

Currency

 

 

Event

Actual

 

Forecast

 

Previous

Sep. 24

 

JPY

 

 

Monetary Policy Meeting Minutes 

 

 

 

 

 

 

 

HUF

 

 

Hungarian Retail Sales (YoY) 

-2.60%

 

-1.90% 

 

-1.70% 

 

 

EUR

 

 

German Ifo Business Climate Index 

101.4

 

102.5 

 

102.3 

 

 

EUR

 

 

German Current Assessment 

110.3

 

111.0 

 

111.1 

 

 

EUR

 

 

German Business Expectations 

93.2

 

95.0 

 

94.2 

 

WEEKLY

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

Date

Time

Currency

Event

Forecast

Previous

Sep. 25

07:00

EUR

GfK German Consumer Climate 

5.9

5.9

 

15:00

USD

CB Consumer Confidence 

62.0

60.6

Sep. 26

01:00

EUR

German CPI (MoM) 

-0.1%

0.4%

 

01:00

EUR

German CPI (YoY) 

2.0%

2.1%

 

11:00

GBP

CBI Distributive Trades Survey 

5

-3

Sep. 27 

08:55

EUR

German Unemployment Rate 

6.8%

6.8%

 

08:55

EUR

German Unemployment Change 

10K

9K

 

09:30

GBP

Current Account 

-12.4B

-11.2B

 

09:30

GBP

GDP (QoQ) 

-0.5%

-0.5%

 

09:30

GBP

GDP (YoY) 

-0.5%

-0.5%

 Sep. 28 

07:45

EUR

French Consumer Spending (MoM) 

-0.2%

0.1%

 

08:00

CHF

KOF Leading Indicators 

1.55

1.57

Government Bond Auction

Date Time Country 

Sep 25 08:30 Holland 

Sep 25 08:30 Spain 

Sep 25 09:10 Italy  

Sep 25 14:30 UK 

Sep 25 17:00 US 

Sep 26 09:10 Italy  

Sep 26 09:10 Sweden 

Sep 26 09:00 Germany 

Sep 26 14:30 Sweden 

Sep 26 17:00 US 

Sep 27 00:30 Japan 

Sep 27 09:10 Italy  

Sep 27 17:00 US 

 

Oil and Gas Weighed Down by China

WTI crude oil prices have fallen by more than 0.80 percent in international market on resumed concern from Euro-zone and talk over China-Japan trade dispute. German Chancellor Angel Merkel and French President Francois Holland underlined Franco-German disagreement yesterday as they clashed on timetable to introduce the joint oversight of euro-zone banking sector. Ahead of Spain stress test result before the weekend and completion of Greece budget cut plan, the shared currency Euro is likely to remain under pressure.

On the other side, China manufacturing and retailers are less optimistic about increasing sales, as reported by US Beige book.

Most of the Asian equities are trading in a negative territory and supporting a down side move in oil prices also. IFO numbers from German are likely to come in a blend whereas US Dallas fed manufacturing index may remain under pressure. Talk on releasing strategic reserve in order to decline gasoline prices in US, before the presidential election is another factor to keep oil prices under pressure. Expect oil futures prices to continue its bearish move in today trading session.

NYMEX crude oil rose for a second straight day, on supply concerns & economic optimism fueled a rebound from a 7% slide earlier in the week. Brent crude topped $111 per barrel but posted a 4.5% drop on the week due to a 3-day rout that pushed prices from $116 to $108.

Speculators raised their net long futures and options positions in US crude oil by 18,006 contracts to 243,303 in the week to Tuesday. The net long position has risen by 65% in past 3-months, as per CFTC data.

China’s crude oil imports fell to a 22-month low to 18.4mn tons in month of August, equivalent to 4.35mn barrels a day, down 12.6% a year ago.

This morning  natural gas prices are trading above $2.88/MMBTU with gain of more than 0.20 percent in Globex electronic platform. As per National Hurricane Center, tropical storm Miriam has reached the level of Hurricane near to PADD IV region accounts for more gas production in US. MDA Earth Sat, another leading weather forecaster, said the 6 to 10-day forecast period would see cooler temperatures. Thus, speculation of rising demand for space heating purpose may support gas prices to trade on higher side.

The number of rigs actively exploring for oil and natural gas in the US dropped last week by 5 to 1,859. 1,402 rigs were explored for oil and 454 were searching for gas while 3 were listed as miscellaneous, as per oil-field services company Baker Hughes Inc.

Natural Gas Forecast September 24, 2012, Technical Analysis

The natural gas markets had a positive session on Friday and rose enough to test the $2.90 level. The area held as resistance, but the market barely fell back. Because of this we think that is a very likely that we will continue to try and push the market higher. With this in mind, we are not willing to buy this market as it is so overly bearish in the long term, and are willing to step away from the natural gas market in the near-term in order to wait until we get a clearer signal.

 

Natural Gas Forecast September 24, 2012, Technical Analysis
Natural Gas Forecast September 24, 2012, Technical Analysis

Natural Gas Weekly Fundamental Analysis September 24-28, 2012 Forecast

Introduction: Natural gas is nevertheless a major commodity in its own right, which is used for everything from cooking food to heating houses during the winter. Natural Gas is growing much faster than either of its non-renewable fossil fuel competitors, oil and coal.

Do not miss the weekly U.S. gas inventories report. The figures are issued by the Energy Information Administration (EIA) every Thursday afternoon at 15:30 (released Friday at 15:30 if there was a U.S. bank holiday on Monday). Here’s a link to the latest EIA report. The main natural gas moving figure in there is the change in inventories from the previous week. When it comes to the gas inventories report, we’re talking about billions of cubic feet, Bcf for short.

When the actual change in inventories number is released, it is the deviation from the expected number that is really important. If the actual inventories figure shows a 24 Bcf rise when an 84 Bcf increase was expected, then that is actually positive for the price of natural gas. All else equal, the price of natural gas should rise after the release.

A barrel of oil has roughly 6 times the energy content of natural gas. If the fuels were perfect substitutes, oil prices would tend to be about 6 times natural gas prices. However, due to various market characteristics discussed briefly above and the ease of using oil, the price of oil has been following a pattern of 8-12 times that of natural gas. However that ratio has spiked dramatically since March 2009.

Weekly Analysis and Recommendation:

Natural Gas bounced around all week without making much headway. With the introduction of additional stimulus from the Bank of Japan, one of the world’s largest importers of Natural Gas, future demands may increase. NG closed the week at 2.900

Date

Last

Open

High

Low

Change %

Sep 21, 2012

2.900

2.817

2.900

2.791

3.00%

Sep 20, 2012

2.815

2.784

2.821

2.748

1.11%

Sep 19, 2012

2.784

2.775

2.853

2.737

0.34%

Sep 18, 2012

2.775

2.877

2.916

2.756

-3.56%

Sep 17, 2012

2.877

2.945

2.982

2.857

-2.33%

Temperatures for the week were fairly mild with no consumer demand for natural gas and there are some possible storms brewing in the Atlantic, as we remain in hurricane season, but nothing of a threatening nature.

This week’s EIA inventory showed the following:

Working gas in storage was 3,496 Bcf as of Friday, September 14, 2012, according to EIA estimates. This represents a net increase of 67 Bcf from the previous week. Stocks were 320 Bcf higher than last year at this time and 278 Bcf above the 5-year average of 3,218 Bcf. In the East Region, stocks were 76 Bcf above the 5-year average following net injections of 44 Bcf. Stocks in the Producing Region were 150 Bcf above the 5-year average of 974 Bcf after a net injection of 20 Bcf. Stocks in the West Region were 52 Bcf above the 5-year average after a net addition of 3 Bcf. At 3,496 Bcf, total working gas is above the 5-year historical range.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more recent analysis and information in our weekly reports and we provide daily updates and outlooks.

Major Economic Events for the week of September 17-21, 2012 actual v. forecast for Euro, GPB, the Franc, and USD

Date

Currency

Event

Actual

Forecast

Previous

Sep. 17

GBP

Rightmove House Price Index (MoM) 

-0.6%

 

-2.4%

 

USD

NY Empire State Manufacturing Index 

-10.4

-2.0

-5.8

Sep. 18

GBP

Core CPI (YoY) 

2.1%

2.2%

2.3%

 

GBP

CPI (YoY) 

2.5%

2.5%

2.6%

 

GBP

CPI (MoM) 

0.5%

0.5%

0.1%

 

EUR

German ZEW Economic Sentiment 

-18.2

-19.0

-25.5

 

EUR

ZEW Economic Sentiment 

-3.8

-16.5

-21.2

 

USD

Current Account 

-117.4B

-125.5B

-133.6B

 

USD

TIC Net Long-Term Transactions 

67.0B

45.3B

9.3B

Sep. 19  

USD

Building Permits 

0.803M

0.796M

0.811M

 

USD

Housing Starts 

0.750M

0.765M

0.733M

 

USD

Existing Home Sales 

4.82M

4.55M

4.47M

Sep. 20 

EUR

French Manufacturing PMI 

42.6

46.4

46.0

 

EUR

German Manufacturing PMI 

47.3

45.3

44.7

 

EUR

Manufacturing PMI 

46.0

45.4

45.1

 

GBP

Retail Sales (MoM) 

-0.2%

-0.4%

0.3%

 

GBP

Retail Sales (YoY) 

2.7%

2.7%

2.3%

 

EUR

Spanish 10-Year Obligation Auction 

5.666%

 

6.647%

 

GBP

CBI Industrial Trends Orders 

-8

-15

-21

 

USD

Initial Jobless Claims 

382K

375K

385K

 

USD

Continuing Jobless Claims 

3272K

3300K

3304K

 

USD

Philadelphia Fed Manufacturing Index 

-1.9

-4.0

-7.1

 

WEEKLY

 

Economic Highlights of the coming week that affect the Euro, GBP, CHF and the USD

Date

Time

Currency

Event

Forecast

Previous

 Sep. 24

09:00

EUR

German Ifo Business Climate Index 

102.3

102.3

 

09:00

EUR

German Current Assessment 

110.9

111.2

 

09:00

EUR

German Business Expectations 

95.0

94.2

Sep. 25

07:00

EUR

GfK German Consumer Climate 

5.9

5.9

 

15:00

USD

CB Consumer Confidence 

62.0

60.6

Sep. 26

01:00

EUR

German CPI (MoM) 

-0.1%

0.4%

 

01:00

EUR

German CPI (YoY) 

2.0%

2.1%

 

11:00

GBP

CBI Distributive Trades Survey 

5

-3

Sep. 27 

08:55

EUR

German Unemployment Rate 

6.8%

6.8%

 

08:55

EUR

German Unemployment Change 

10K

9K

 

09:30

GBP

Current Account 

-12.4B

-11.2B

 

09:30

GBP

GDP (QoQ) 

-0.5%

-0.5%

 

09:30

GBP

GDP (YoY) 

-0.5%

-0.5%

 Sep. 28 

07:45

EUR

French Consumer Spending (MoM) 

-0.2%

0.1%

 

08:00

CHF

KOF Leading Indicators 

1.55

1.57

 

Natural Gas Fundamental Analysis September 24, 2012 Forecast

Analysis and Recommendations:

Natural Gas is trading at 2.8005 holding on to gains made earlier in this week. Inventory levels are unseasonably high, but global stimulus especially from the Japan, the world’s leading importer of natural gas, is expected to increase manufacturing and production and therefore increase the demands on gas.

Natural gas futures closed higher backed by technical buying and short covering, despite concerns over mild weather forecasts in US and slowing demand. The US Energy Information Administration reported an increase in gas inventories by 67bn cubic feet to 3.496 trillion cubic feet for the week ended Sept. 14

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Economic Data September 21, 2012 actual v. forecast

Date

 

Currency

 

 

Event

Actual

 

Forecast

 

Previous

 

 

Sep. 21

 

AUD

 

 

CB Leading Index (MoM) 

0.0%

 

 

 

0.5% 

   

 

 

NZD

 

 

Credit Card Spending (YoY) 

1.0%

 

 

 

0.1% 

 

 

 

 

EUR

 

 

Dutch Consumer Spending 

-1.50

 

 

 

-0.50 

   

 

 

GBP

 

 

Public Sector Net Borrowing 

12.4B

 

13.3B 

 

-1.9B 

   

 

 

CAD

 

 

Core CPI (MoM) 

0.3%

 

0.3% 

 

-0.1% 

 

 

 

 

CAD

 

 

CPI (MoM) 

0.2%

 

0.4% 

 

-0.1% 

 

 

 

 

CAD

 

 

Wholesale Sales (MoM) 

-0.6%

 

-0.1% 

 

-0.3% 

   

 

 

CAD

 

 

CPI (YoY) 

1.2%

 

1.0% 

 

1.3% 

 

 

 

 

EUR

 

 

Belgium NBB Business Climate 

-11.6

 

-11.2 

 

-11.8 

 

 

 

WEEKLY

Upcoming Economic Events that affect the EUR ( there are no USD or CAD events )

Date

Time

Currency

Event

Forecast

Previous

 Sep. 24

09:00

EUR

German Ifo Business Climate Index 

102.1 

102.3 

 

09:00

EUR

German Current Assessment 

 

111.2 

 

09:00

EUR

German Business Expectations 

 

94.2 

Government Bond Auction

Date Time Country 

Sep 24 09:10 Norway 

Sep 24 09:30 Germany 

Sep 24 10:00 Belgium 

Sep 24 15:30 Italy  

Sep 25 08:30 Holland 

Sep 25 08:30 Spain 

Sep 25 09:10 Italy  

Sep 25 14:30 UK 

Sep 25 17:00 US 

Sep 26 09:10 Italy  

Sep 26 09:10 Sweden 

Sep 26 09:00 Germany 

Sep 26 14:30 Sweden 

Sep 26 17:00 US 

Sep 27 00:30 Japan 

Sep 27 09:10 Italy  

Sep 27 17:00 US 

 

Crude Oil Buoyed by Syrian Civil War and PBoC Stimulus

During the early Asian session oil futures prices are trading close to $93/bbl in international market. Intensified Civil war in Syria and concern of regional war between Iran and Israel are supporting oil prices to remain on higher. Yesterday, more than 50 people were killed after an airstrike hit the northern Syria. Poling by Israeli and Palestine members came to a conclusion that there may be a regional war in order to stop Iran nuclear program. Thus, this kind of Geopolitical issue is likely to play a major role for today oil prices as Syria and Iran both are linked to the strategic oil delivery points.

Nymex crude oil halted earlier declines on Thursday, with some oil dealers saying prices had fallen too far, too fast. Oil prices held unto most gains after U.S. data showed the number of Americans filing new claims for jobless benefits fell last week. Concerns about the economic weakness prompting central bank action, indications that OPEC’s top exporter Saudi Arabia is working to lower oil prices, and rising

U.S. crude oil inventories helped fuel this week’s price slide. Helping curb U.S. crude prices, data on Thursday showed U.S. manufacturing closed out its weakest quarter in three years this month and U.S. jobless claims held near two-month highs last week, suggesting stalled economic growth.

The National hurricane center reports that there is 60 percent chance of tropical cyclone formation near to Gulf region, which may support oil prices to trade on higher side on concern of supply disturbances.

This morning the People’s Bank of China has moved to inject liquidity into its local markets, conducting 101 billion yuan ($A15.3 billion) worth of open market operations in its banking system, Reuters News reports. According to the news agency, the injection is the first in three weeks and adds to the 966 billion yuan already added to the financial system so far this year. The moves have fuelled uncertainty over the extent Beijing is willing to boost the weakening Chinese economy.

China being one of the world’s largest consumer of crude oil, might help push up prices as stimulus should spark China’s manufacturing sector increasing demand on energy products especially crude oil.

There are no major economic releases for today. On basis of geopolitical concern we may expect oil futures to hold its upside movement for today session.

This morning natural gas prices are trading above $2.80/MMBTU with gain of more than 0.80 percent in Globex electronic platform. Tensions in the Middle East as mentioned above will weigh on all energy products, but the possibility of a hurricane will have a more direct affect on natural gas from the gulf region.

The largest LNG consumer Japan is likely to increase its LNG import by more than 15 percent in 2013, which may support gas futures prices to trade on higher side.  With additional stimulus from the Bank of Japan, production and manufacturing should increase and increase demand for gas.

Expectation of rising space cooling demand may keep gas prices high for today’s session. MDA Earth Sat, another leading weather forecaster, said the 6 to 10-day forecast period would see cooler temperatures and characterized the forecast for the 11- to 15-day period as “a bit cooler than expected as well. 

Natural Gas Forecast September 21, 2012, Technical Analysis

The natural gas markets rose slightly during the session on Thursday, but still look inherently weak. The market has found quite a bit of resistance in the $2.90 level previously, and it is underneath that area that we find the market and right now.

We think that the downtrend is most certainly still in effect, and as such are willing to sell weak candles as they appear below the $3.30 handle as we think that is the most important barrier for the buyers to overcome. At that point time, we would have to consider a much larger move higher. However, we haven’t seen that yet, and still believe that this market has a downward bias. We would sell weak candles and fail at the $2.90 level, and of course sell a break of the lows from the Wednesday session which would be firing off sell orders from that shooting star.

 

Natural Gas Forecast September 21, 2012, Technical Analysis
Natural Gas Forecast September 21, 2012, Technical Analysis

Natural Gas Fundamental Analysis September 21, 2012, Forecast

Analysis and Recommendations:

Natural Gas is trading at 2.808 adding 0.045 in today’s session.

Today’s EIA inventory showed an increase in stocks but not as much as traders had expected, which help push up prices.

Working gas in storage was 3,496 Bcf as of Friday, September 14, 2012, according to EIA estimates. This represents a net increase of 67 Bcf from the previous week. Stocks were 320 Bcf higher than last year at this time and 278 Bcf above the 5-year average of 3,218 Bcf. In the East Region, stocks were 76 Bcf above the 5-year average following net injections of 44 Bcf. Stocks in the Producing Region were 150 Bcf above the 5-year average of 974 Bcf after a net injection of 20 Bcf. Stocks in the West Region were 52 Bcf above the 5-year average after a net addition of 3 Bcf. At 3,496 Bcf, total working gas is above the 5-year historical range.

The largest LNG consumer Japan is likely to increase its LNG import by more than 15 percent in 2013, which may support gas futures prices to trade on higher side. Expectation of rising space cooling demand may keep gas prices high for today’s session. MDA Earth Sat, another leading weather forecaster, said the 6 to 10-day forecast period would see cooler temperatures and characterized the forecast for the 11- to 15-day period as “a bit cooler than expected as well

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Economic Data September 20, 2012 actual v. forecast

Date

 

Currency

 

 

Event

Actual

 

Forecast

 

Previous

 

 

Sep. 20

 

JPY

 

 

Trade Balance 

-0.47T

 

-0.37T 

 

-0.37T 

   

 

 

CNY

 

 

Chinese HSBC Manufacturing PMI 

47.80

 

 

 

47.60 

 

 

 

 

EUR

 

 

French Manufacturing PMI 

42.6

 

46.4 

 

46.0 

 

 

 

 

EUR

 

 

German Manufacturing PMI 

47.3

 

45.3 

 

44.7 

 

 

 

 

EUR

 

 

Manufacturing PMI 

46.0

 

45.4 

 

45.1 

 

 

 

 

GBP

 

 

Retail Sales (MoM) 

-0.2%

 

-0.4% 

 

0.3% 

 

 

 

 

GBP

 

 

Retail Sales (YoY) 

2.7%

 

2.7% 

 

2.3% 

   

 

 

GBP

 

 

CBI Industrial Trends Orders 

-8

 

-15 

 

-21 

 

 

 

 

USD

 

 

Initial Jobless Claims 

382K

 

375K 

 

385K 

   

 

 

USD

 

 

Continuing Jobless Claims 

3272K

 

3300K 

 

3304K 

   

 

 

USD

 

 

Philadelphia Fed Manufacturing Index 

-1.9

 

-4.0 

 

-7.1 

   

 

WEEKLY

 

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

There are no top tier eco data releases due in Europe or the US on the 21st.

Government Bond Auction

Date Time Country 

Sep 21 15:30 Italy  

Natural Gas Forecast September 20, 2012, Technical Analysis

The natural gas markets rose during the session on Wednesday, but found quite a bit of resistance above the $2.80 level. This formed a shooting star as a result, and it looks like the market is ready to start falling again. The fact that the buyers failed completely by the end of the session suggests that there is still plenty of selling pressure, and we think this is somewhat obvious as the trend is so strongly to the downside over the last couple of years. We are selling brakes of the lows for Wednesday, as we push towards $2.60 and below. As far as buying natural gas is concerned, we aren’t even considering it until we get to $3.30 or above.

Natural Gas Forecast September 20, 2012, Technical Analysis
Natural Gas Forecast September 20, 2012, Technical Analysis

Natural Gas Fundamental Analysis September 20, 2012, Forecast

Analysis and Recommendations:

Natural Gas is trading at 2.841 adding 0.068 today. It seems that NG is marching to its own drummer as crude oil continued to decline today. News of the Japanese monetary stimulus helped support NG as Japan is a large importer of LNG.

Traders are waiting for Thursday weekly storage report hoping that inventories have not increased as much as expected.

Weather in the US is in the normal range as summer temperatures pass. There are no new storms affecting production at this time.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Economic Data September 19, 2012 actual v. forecast

Date

 

Currency

 

 

Event

Actual

 

Forecast

 

Previous

 

 

Sep. 19

 

JPY

 

 

Interest Rate Decision 

0.10%

 

0.10% 

 

0.10% 

 

 

 

 

USD

 

 

Building Permits 

0.803M

 

0.796M 

 

0.811M 

 

 

 

 

USD

 

 

Housing Starts 

0.750M

 

0.765M 

 

0.733M 

   

 

WEEKLY

 

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

Date

Time

Currency

Event

Forecast

Previous

Sep. 20 

07:58

EUR

French Manufacturing PMI 

46.4 

46.0 

 

08:28

EUR

German Manufacturing PMI 

45.3 

44.7 

 

09:30

GBP

Retail Sales (MoM) 

-0.4% 

0.3% 

 

09:30

GBP

Retail Sales (YoY) 

2.7% 

2.8% 

 

11:00

GBP

CBI Industrial Trends Orders 

-15 

-21 

Government Bond Auction

Date Time Country 

Sep 20 08:30 Spain 

Sep 20 08:50 France 

Sep 20 09:30 UK 

Sep 20 09:50 France 

Sep 20 15:00 US 

Sep 20 17:00 US 

Sep 21 15:30 Italy  

Natural Gas Forecast September 19, 2012, Technical Analysis

The natural gas markets fell during the Monday session as the downtrend continued. The downside to the natural gas market continues to be the more interesting one, and as long as we stay well under the $3.30 level, we think that the downtrend will continue. It is at that level that we see the trend changing.

Breaking below the $2.60 level would be a very significant turn of events and push this market much lower. We think the massive supply out there of natural gas is simply far too much for the demand to push prices up for any sustained length of time. Because of this, we are selling rallies as they come.

Natural Gas Forecast September 19, 2012, Technical Analysis
Natural Gas Forecast September 19, 2012, Technical Analysis

Natural Gas Fundamental Analysis September 19, 2012 Forecast

Analysis and Recommendations:

Natural Gas remains under 3.00 trading at 2.867 as investors wait for this week’s inventory. With FOMC elation is declining and markets returning to normal, natural gas will be priced more on fundamentals and less on future demand on hopes of stimulus or increased production and manufacturing. Following crude, energy prices need to remain low to help jumpstart the economy.

Natural gas futures closed lower, for the forth straight session, pressured by forecasts of mild US weather for the next 2-weeks that should slow overall demand and increase the amount of storage to already swollen inventories.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Economic Data September 18, 2012 actual v. forecast

Sep. 18

 

AUD

 

 

Monetary Policy Meeting Minutes 

             

 

 

CNY

 

 

China House Prices (MoM) 

-1.40%

     

-1.50%

   

 

 

GBP

 

 

Core CPI (YoY) 

2.1%

 

2.2%

 

2.3%

   

 

 

GBP

 

 

CPI (YoY) 

2.5%

 

2.5%

 

2.6%

   

 

 

GBP

 

 

RPI (YoY) 

2.9%

 

3.1%

 

3.2%

   

 

 

GBP

 

 

DCLG House Price Index (YoY) 

2.0%

 

2.8%

 

2.3%

   

 

 

GBP

 

 

CPI (MoM) 

0.5%

 

0.5%

 

0.1%

   

 

 

EUR

 

 

German ZEW Economic Sentiment 

-18.2

 

-19.0

 

-25.5

   

 

 

EUR

 

 

ZEW Economic Sentiment 

-3.8

 

-16.5

 

-21.2

   

 

 

USD

 

 

Current Account 

-117.4B

 

-125.5B

 

-133.6B

   

 

WEEKLY

 

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

Date

Time

Currency

Event

Forecast

Previous

Sep. 19 

13:30

USD

Building Permits 

0.800M 

0.811M 

 

13:30

USD

Housing Starts 

0.765M 

0.746M 

 

15:00

USD

Existing Home Sales 

4.56M 

4.47M 

Sep. 20 

07:58

EUR

French Manufacturing PMI 

46.4 

46.0 

 

08:28

EUR

German Manufacturing PMI 

45.3 

44.7 

 

09:30

GBP

Retail Sales (MoM) 

-0.4% 

0.3% 

 

09:30

GBP

Retail Sales (YoY) 

2.7% 

2.8% 

 

11:00

GBP

CBI Industrial Trends Orders 

-15 

-21 

Government Bond Auction

Date Time Country 

Sep 19 09:10 Sweden 

Sep 19 09:30 Germany 

Sep 19 09:30 Portugal 

Sep 19 10:00 Norway 

Sep 20 08:30 Spain 

Sep 20 08:50 France 

Sep 20 09:30 UK 

Sep 20 09:50 France 

Sep 20 15:00 US 

Sep 20 17:00 US 

Sep 21 15:30 Italy

Natural Gas Forecast September 18, 2012, Technical Analysis

The natural gas market fell during the session on Monday after attempting to rally. The market currently sits just below the $2.90 level, and as such we think that we will continue lower. The market has been in a nasty downtrend for a couple of years now, and every time we rally like this we do see a pullback. However, we do need to get below the $2.60 level to continue the trend lower. If we cannot, we will have to start thinking about avoiding this market. In the meantime though, if we break the bottom of the session lows from Monday, it would be worth thinking about taking a short position.

Natural Gas Forecast September 18, 2012, Technical Analysis
Natural Gas Forecast September 18, 2012, Technical Analysis

Natural Gas Fundamental Analysis September 18, 2012, Forecast

Natural gas futures continued to consolidate on Monday as traders once again failed to choose a direction in the market due to conflicting fundamentals.

With natural gas stocks about 9% above their 5-year average, traders were counting on a forecast of cooler weather to begin to drive up demand for gas. Additionally, the weather isn’t hot enough either to garner demand for electricity. With demand falling, traders are keeping a lid on prices because of an expected increase in supply.

If forecasters continue to leave out hot or cold extreme temperatures then look for sellers to continue to pressure natural gas prices on Tuesday. This could lead to a resumption of the long-term downtrend as long as the supply continues to grow. 

Natural Gas Forecast for the week of September 17, 2012, Technical Analysis

The natural gas markets rose during the week as the grind higher continues. However, we have a hanging man from Thursday that was broken on Friday and this does suggest lower prices. On top of that, this is with the overall trend of the marketplace so we do prefer this type of signal. As for the weekly chart though, it must be stated that we are grinding higher overtime. However, there is far too much supply out there for demand to take care of. At this point time we are still bearish of this market but cognizant of the fact that if the $3.30 level get broken to the upside, we would have to start buying.

 

Natural Gas Forecast for the week of September 17, 2012, Technical Analysis
Natural Gas Forecast for the week of September 17, 2012, Technical Analysis

Natural Gas Forecast September 17, 2012, Technical Analysis

The natural gas markets fell again and broke below the hammer from Thursday in order to confirm it as a “hanging man.” This is a very bearish sign, and we think that if we can get below the $2.90 level, we will fall to retest the to $2.60 level again. We have this chart, it has been a slow grind higher, but the fact is are simply far too much supply for demand to soak up in this market. Because of this, we are still structurally bearish of the natural gas markets, and will certainly be looking to sell soon.

 

Natural Gas Forecast September 17, 2012, Technical AnalysisNatural Gas Forecast September 17, 2012, Technical Analysis
Natural Gas Forecast September 17, 2012, Technical AnalysisNatural Gas Forecast September 17, 2012, Technical Analysis

Natural Gas Weekly Fundamental Analysis September 17-21, 2012, Forecast

Introduction: Natural gas is nevertheless a major commodity in its own right, which is used for everything from cooking food to heating houses during the winter. Natural Gas is growing much faster than either of its non-renewable fossil fuel competitors, oil and coal.

Do not miss the weekly U.S. gas inventories report. The figures are issued by the Energy Information Administration (EIA) every Thursday afternoon at 15:30 (released Friday at 15:30 if there was a U.S. bank holiday on Monday). Here’s a link to the latest EIA report. The main natural gas moving figure in there is the change in inventories from the previous week. When it comes to the gas inventories report, we’re talking about billions of cubic feet, Bcf for short.

When the actual change in inventories number is released, it is the deviation from the expected number that is really important. If the actual inventories figure shows a 24 Bcf rise when an 84 Bcf increase was expected, then that is actually positive for the price of natural gas. All else equal, the price of natural gas should rise after the release.

A barrel of oil has roughly 6 times the energy content of natural gas. If the fuels were perfect substitutes, oil prices would tend to be about 6 times natural gas prices. However, due to various market characteristics discussed briefly above and the ease of using oil, the price of oil has been following a pattern of 8-12 times that of natural gas. However that ratio has spiked dramatically since March 2009.

Weekly Analysis and Recommendation:

Natural Gas is about the only commodity that did not soar this week, as injection inventory showed a higher than expected inventory and moderate temperatures reduced consumer demand.

Date

Last

Open

High

Low

Change %

Sep 14, 2012

2.955

3.027

3.062

2.922

-2.41%

Sep 13, 2012

3.028

3.067

3.068

2.962

-1.21%

Sep 12, 2012

3.065

3.018

3.071

2.950

1.59%

Sep 11, 2012

3.017

2.837

3.026

2.803

6.34%

Sep 10, 2012

2.837

2.659

2.845

2.655

6.75%

There are two storms in the Atlantic but not really at the point of pushing prices. The only support natural gas received was the drop in the USD which helped offset some of the price declines.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more recent analysis and information in our weekly reports and we provide daily updates and outlooks.

Major Economic Events for the week of September 10-14, 2012 actual v. forecast for Euro, GPB, the Franc, and USD

Date

Time

Currency

Event

Actual

Forecast

Previous

Sep. 11

00:01

GBP

RICS House Price Balance 

-19%

-22% 

-23% 

 

06:30

EUR

French Non-Farm Payrolls (QoQ) 

-0.1%

-0.1% 

-0.1% 

 

09:30

GBP

Trade Balance 

-7.2B

-9.0B 

-10.1B 

 

13:30

USD

Trade Balance 

-42.0B

-44.0B 

-41.9B 

 Sep. 12

06:30

EUR

French CPI (MoM) 

0.7%

0.5% 

-0.4% 

 

07:00

EUR

German CPI (MoM) 

0.4%

0.3% 

0.3% 

 

07:00

EUR

German CPI (YoY) 

2.1%

2.0% 

2.0% 

 

09:30

GBP

Average Earnings Index +Bonus 

1.5%

1.6% 

1.8% 

 

09:30

GBP

Claimant Count Change 

-15.0K

0.5K 

-13.6K 

 

10:00

EUR

Industrial Production (MoM) 

0.6%

-0.1% 

-0.6% 

 

13:30

USD

Import Price Index (MoM) 

0.7%

1.4% 

-0.7% 

 

18:00

USD

10-Year Note Auction 

1.764%

 

1.680% 

 Sep. 13

08:15

CHF

PPI (MoM) 

0.5%

-0.4% 

-0.3% 

 

08:30

CHF

Interest Rate Decision 

0.00%

0.00% 

0.00% 

 

13:30

USD

Core PPI (MoM) 

0.2%

0.2% 

0.4% 

 

13:30

USD

PPI (MoM) 

1.7%

1.1% 

0.3% 

 

13:30

USD

Initial Jobless Claims 

382K

370K 

367K 

 

13:30

USD

Continuing Jobless Claims 

3283K

3318K 

3332K 

 

13:30

USD

PPI (YoY) 

2.0%

1.4% 

0.5% 

 

13:30

USD

Core PPI (YoY) 

2.5%

2.6% 

2.5% 

 

17:30

USD

Interest Rate Decision 

0.25%

0.25% 

0.25% 

 

19:00

USD

Federal Budget Balance 

-191.0B

-155.0B 

-69.6B 

Sep. 14

10:00

EUR

CPI (YoY) 

2.6%

2.6% 

2.6% 

 

10:00

EUR

Employment Change (QoQ) 

0.0%

-0.2% 

-0.2% 

 

10:00

EUR

Core CPI (YoY) 

1.5%

1.7% 

1.7% 

 

13:30

USD

Core CPI (MoM) 

0.1%

0.2% 

0.1% 

 

13:30

USD

Core Retail Sales (MoM) 

0.8%

0.6% 

0.8% 

 

13:30

USD

CPI (MoM) 

0.6%

0.5% 

0.0% 

 

13:30

USD

Retail Sales (MoM) 

0.9%

0.7% 

0.6% 

 

13:30

USD

CPI (YoY) 

1.7%

1.7% 

1.4% 

 

13:30

USD

Core CPI (YoY) 

1.9%

2.0% 

2.1% 

 

14:15

USD

Industrial Production (MoM) 

-1.2%

0.2% 

0.5% 

 

14:55

USD

Michigan Consumer Sentiment 

79.2

74.0 

74.3 

Historical: From 2010 to Present

Highest: 6.106 on Jan 07, 2010

Average: 3.836 over this period

Lowest: 1.903 on April 19, 2012 

 

WEEKLY

 

Economic Highlights of the coming week that affect the Euro, GBP, CHF and the USD

Date

Time

Currency

Event

Forecast

Previous

 Sep. 17

13:30

USD

NY Empire State Manufacturing Index 

-2.0 

-5.8 

Sep. 18

09:30

GBP

CPI (YoY) 

2.5% 

2.6% 

 

09:30

GBP

CPI (MoM) 

0.5% 

0.1% 

 

10:00

EUR

German ZEW Economic Sentiment 

-19.0 

-25.5 

 

13:30

USD

Current Account 

-126.0B 

-137.3B 

 

14:00

USD

TIC Net Long-Term Transactions 

 

9.3B 

Sep. 19 

13:30

USD

Building Permits 

0.800M 

0.811M 

 

13:30

USD

Housing Starts 

0.765M 

0.746M 

 

15:00

USD

Existing Home Sales 

4.56M 

4.47M 

Sep. 20 

07:58

EUR

French Manufacturing PMI 

46.4 

46.0 

 

08:28

EUR

German Manufacturing PMI 

45.3 

44.7 

 

09:30

GBP

Retail Sales (MoM) 

-0.4% 

0.3% 

 

09:30

GBP

Retail Sales (YoY) 

2.7% 

2.8% 

 

11:00

GBP

CBI Industrial Trends Orders 

-15 

-21 

Government Bond Auction

Date Time Country 

Sep 17 09:10 Slovakia

Sep 17 10:00 Norway 

Sep 18 08:30 Spain 

Sep 18 09:10 Greece 

Sep 18 09:30 Belgium 

Sep 19 09:10 Sweden 

Sep 19 09:30 Germany 

Sep 19 09:30 Portugal 

Sep 19 10:00 Norway 

Sep 20 08:30 Spain 

Sep 20 08:50 France 

Sep 20 09:30 UK 

Sep 20 09:50 France 

Sep 20 15:00 US 

Sep 20 17:00 US 

Sep 21 15:30 Italy  

Natural Gas Fundamental Analysis September 17, 2012, Forecast

Analysis and Recommendations:

Natural Gas held fairly close to the 3.00 price range today, without much action, trading now at 3.013.

As per US energy department, natural gas storage has been increased by 27 BCF, higher than survey. Inventories are currently 342 Bcf (11.1 percent) greater than last year at this time and 284 Bcf (9.0 percent) greater than the 5-year average. Weekly demand has been declined by 4.9 percent in the last week. Thus, weak fundamental report may weigh on gas prices movement for the day. However,  as per National Hurricane Centre, storm Nadine is just below hurricane strength, which may create supply disturbances in PADD III region. Another tropical storm Kristy is also near to PADD V region may have impact on production and refining units, which may again support gas prices

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Economic Data September 14, 2012 actual v. forecast

Date

 

Currency

 

 

Event

Actual

 

Forecast

 

Previous

Sep. 14

 

JPY

 

 

Industrial Production (MoM) 

-1.0%

 

-1.2% 

 

-1.2% 

 

 

EUR

 

 

CPI (YoY) 

2.6%

 

2.6% 

 

2.6% 

 

 

EUR

 

 

Employment Change (QoQ) 

0.0%

 

-0.2% 

 

-0.2% 

 

 

EUR

 

 

Core CPI (YoY) 

1.5%

 

1.7% 

 

1.7% 

 

 

USD

 

 

Core CPI (MoM) 

0.1%

 

0.2% 

 

0.1% 

 

 

USD

 

 

Core Retail Sales (MoM) 

0.8%

 

0.6% 

 

0.8% 

 

 

USD

 

 

CPI (MoM) 

0.6%

 

0.5% 

 

0.0% 

 

 

CAD

 

 

Manufacturing Sales (MoM) 

-1.50%

 

1.00% 

 

-0.80% 

 

 

USD

 

 

Retail Sales (MoM) 

0.9%

 

0.7% 

 

0.6% 

 

 

USD

 

 

CPI (YoY) 

1.7%

 

1.7% 

 

1.4% 

 

 

USD

 

 

Core CPI (YoY) 

1.9%

 

2.0% 

 

2.1% 

 

WEEKLY

 

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

Date

Time

Currency

 

Event

 

Forecast

Previous

Sep. 18

09:30

GBP

 

CPI (YoY) 

 

 

2.6% 

 

09:30

GBP

 

CPI (MoM) 

 

 

0.1% 

 

10:00

EUR

 

German ZEW Economic Sentiment 

 

-25.5 

-25.5 

Government Bond Auction

Date Time Country 

Sep 17 09:10 Slovakia

Sep 17 10:00 Norway 

Sep 18 08:30 Spain 

Sep 18 09:10 Greece 

Sep 18 09:30 Belgium 

Sep 19 09:10 Sweden 

Sep 19 09:30 Germany 

Sep 19 09:30 Portugal 

Sep 19 10:00 Norway