Hi All,
Thanks for the participating great discussion in this thread.
I'm being a Energy trader from last 3 years, I would like to shed some light for NG trading.
In commodity market sheer demand/supply work. demand is consumption supply is inventory, Like London metal exchange(LME) declare the copper, aluminium etc inventories, in USA U.S. Energy Information Administration (EIA) declare NG storage data every Thursday(for crude oil Wednesday) for the last week ended on Friday. data shows the real demand and supply story.
US has already surplus NG invetory so data as -ve shows country has consumed lot of gas for cooling in winter and heating in summer so when inventories are -ve NG goes up(demand-supply) when the are +ve it goes down. but apart from that, there is weather forecast which make NG move, even before the data declares and there are model which predict consumption of NG depend upon temperature last week and compare them with last 5 years data and project the inventories. so when inventories are less than excepted, like what happen last week(19th dec), people were excepting -260BCF but actual came at -285, so gas prices shootup. tomorrow it is excepted at -150BCF less that last week's so price so you can see NG trading lower than last week's price, weather forecast is above average temp, so over are data is not showing any sign of bull trend NG, if actual data is going to come less than 150 then NG will drop more even tough the inventory comes -ve. so just -ve inventory is not going to give you a trade. need to study demand supply and weather forecast with excepted inventory.
I wish you all of you A very Happy New Year. and good trading year ahead.
Regards