Thursday’s EIA print, however, could mark the end – or near end – of this year’s injection season. Freezing air and snow pushed into the Midwest over the past weekend and continued to spread into the East this week. This drove up consumption of natural gas to heat homes and businesses – and ultimately powered futures ahead Wednesday. The December Nymex gas futures contract settled at $6.200/MMBtu, up 16.6 cents day/day. NWS data pointed to below-average temperatures enduring, with highs next week ranging from the teens to the 40s in northern markets. Temperatures were forecast to dive below zero at times in far northern markets this week and range from the teens to the 20s elsewhere, according to NWS.
“No question, you are seeing demand go up for natural gas and that’s going to be there through the winter now,” Mike Matousek, a trader at U.S. “Production is up on the year, as everyone knows, but producers have moved cautiously and Exness Broker Review it’s really hard to predict if it can go up much from here” with winter arriving. “Trading floor” refers to an area where trading activities in financial instruments, such as equities, fixed income, futures, etc., takes place.
In other pockets of the market, the U.S. dollar lost ground while oil gained slightly as geopolitical jitters eased after a Russian-made missile struck Poland Tuesday and reignited fears over an escalation of Russia’s war in Ukraine. President Joe Biden met with NATO allies Wednesday at the G20 gathering in Bali, Indonesia, and defused concerns while asserting U.S. officials will support Poland as it investigates whether the missile was fired from Russia. Early estimates for the week ended Nov. 11 submitted to Bloomberg ranged from 60 Bcf to 72 Bcf, with a median of 66 Bcf. Preliminary results of Reuters’ poll landed at an average increase of 64 Bcf and spanned 51 Bcf to 78 Bcf.
The market will get its next look at storage levels on Thursday, when the U.S. Energy Information Administration prints its reading for the week ended Nov. 11. “The market is also digesting just how much inflation is affecting the consumer, with key retail earnings beating expectations and retail sales.” The Commerce Department said Wednesday retail sales jumped 1.3% in October as Americans shelled out for food, gas, and big-ticket items last month despite inflationary pressures. Economists surveyed by Bloomberg expected a headline increase of 1.0% after activity was flat during the prior month. AccuWeather meteorologists warned that wintry conditions could persist deep into next week across much of the northern United States.
- There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products.
- Economists surveyed by Bloomberg expected a headline increase of 1.0% after activity was flat during the prior month.
- Cheyenne Hub fell 36.0 cents day/day to average $5.765, while Opal lost 49.0 cents to $7.825 and Chicago Citygate declined 24.5 cents to $5.700.
- Cash prices had surged an average $1.415 on Monday amid the intensifying cold.
U.S. stocks fell in a lackluster session Wednesday as Wall Street weighed an earnings warning from retail bellwether Target against government data on retail sales that showed robust consumer spending ahead of the key holiday season. What’s more, as Wood Mackenzie analyst Kara Ozgen noted Wednesday, several pipeline operators warned this week of potential flow interruptions in the eastern half of the country because of the freezing weather. These include Southern Natural Gas, Texas Eastern Transmission, Tennessee Gas Pipeline and East Tennessee Natural Gas, and Algonquin Gas Transmission. Cheyenne Hub fell 36.0 cents day/day to average $5.765, while Opal lost 49.0 cents to $7.825 and Chicago Citygate declined 24.5 cents to $5.700. Spot gas prices on Wednesday stepped lower for a second straight day, led down by declines in the Rockies and the Midwest.
Wat zijn futures?
In both cases, participants in these markets must understand the handle and stem of their price quotes. Believing that transparent markets empower businesses, economies, and communities, Natural Gas Intelligence provides natural gas price transparency and key news, insights and data for the North American energy markets. National Weather Service data on Wednesday substantiated NatGasWeather’s read that temperatures could moderate by early next month.
In forex markets, the handle includes both the dollar amount and typically the digits to the right of the decimal point as well that appear on both sides of a two-way quote. A handle is the the part of a price quote that exists to the left of the decimal point in the full quote. James Chen, CMT is an expert trader, investment adviser, and global market strategist. He has authored books on technical analysis and foreign exchange trading published by John Wiley and Sons and served as a guest expert on CNBC, BloombergTV, Forbes, and Reuters among other financial media. That increase boosted inventories to 3,580 Bcf and brought stocks within 2.1% of the five-year average.
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Looking ahead to Thursday’s U.S. Energy Information Administration inventory report, analysts are looking for a relatively plump storage build. That noted, “longer-range forecasts continue to favor a seasonal to slightly bearish pattern for most of the U.S. to start December, although with the risk of colder trends” further into next month, the firm added. That compares with an injection of 23 Bcf a year earlier and a five-year average withdrawal of 5 Bcf. The Wall Street Journal’s survey showed a range of 50 Bcf to 72 Bcf, and an average injection expectation of 63 Bcf. Elsewhere on earnings, retail quarters other than Target’s have so far topped analyst estimates.
Without an updated timeline from Freeport LNG officials, the news spawned ongoing speculation among market participants that the facility’s return may not happen until early 2023. If this were to bear out, it would keep more gas at home, further fortify U.S. supplies and help offset concerns about meeting demand even if the Lower 48 winter proves harsh or exceptionally long. Freeport LNG had set a goal of relaunching in November, but multiple media reports in recent days have called that into question.
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In the near term, however, this week’s cold and snowy conditions across the nation’s midsection and in the East were likely to persist into next week. NWS forecasts called for bitter overnight lows in northern markets that could drop below zero at times over the next several days. Meanwhile, doubts about the timing of the Freeport LNG export terminal’s return, which Brokerage Company PRTrend had been slated for this month, continued to simmer Tuesday and helped keep gains in check. A June fire forced the plant offline, shrinking the pool of liquefied natural gas available to export by about 2.0 Bcf/d. Much of this gas instead has since been funneled back into domestic supplies, helping the market fortify levels of heating fuel in storage for winter.
Natural gas futures pushed higher a second straight day as wintry weather canvassed the Midwest and Northeast – key natural gas demand regions – fueling consumption and supporting prices. The December Nymex gas futures contract gained 10.1 cents day/day and settled at $6.034/MMBtu. Amid the expansive global foreign exchange market, spot markets and forward markets are highly relevant for the term handle. Spot markets are markets for financial instruments such as commodities and securities that can be traded immediately or on the spot. This stands in contrast with the forwards market, which works with prices at a later date.
Natural Gas Futures Extend Win Streak as Freezing Weather Overshadows Bearish Risks, Supports Prices
The foreign exchange, or Forex, is a decentralized marketplace for the trading of the world’s currencies. Charles is a nationally recognized capital markets specialist and educator with over 30 years of experience developing in-depth training programs for burgeoning financial professionals. Charles has taught at a number of institutions including Goldman Sachs, Morgan Stanley, Societe Generale, and many more. Already, output this week is down about 1 Bcf/d, and further declines are expected.
“As a result of widespread subfreezing temperatures, the first wellhead freeze-offs of the season are in the process of dropping U.S. production by 2 Bcf/d,” NatGasWeather said. It also leaves more gas in the Lower 48 that could be used to further fortify storage levels. This could ease supply concerns ahead of winter and, simultaneously, add bearish price sentiment. In the East, Columbia Gas shed 21.0 cents to $5.320, while Tenn Zone 4 200L slipped 39.0 cents to $5.460 and PNGTS fell 19.5 cents to $6.670. Hubs in the Midwest and East helped lead the national average lower as several locations posted modest corrections following triple-digit gains on Monday.
In forex, the handle refers to that part of the quote that appears in both numbers of the spread. Traders often refer to only the handle of a price quote since it is assumed that other Equiti Forex Broker Review market participants know the stem of the quote. For example, if S&P 500 futures are trading at $2885.43, the handle could be conveyed simple as 2885, or shortened to just the 85 handle.
The widespread cold could cause wellhead freeze-offs and interrupt production in some regions. Production hovered around 99 Bcf/d on Tuesday, according to Bloomberg’s estimate, down about 1 Bcf/d from the start of the week and down about 2 Bcf/d from the record levels reached in October. National Weather Service data showed below-average temperatures spanning from the northern Rockies and Plains across much of the Midwest into the Great Lakes and New England Tuesday, with more of the same expected through the trading week. Chilly rains and snow were expected to pepper the northern landscape, amplifying freezing overnight lows. Cash prices in the Northeast on Wednesday were an exception to the broader rule. Transco Zone 6 NY gained 93.0 cents to $7.370 and Algonquin Citygate near Boston jumped $1.125 to $7.575.
If the price drops to $2875.90, a trader may say that the index has dropped ten handles. A handle is the whole number part of a price quote, that is, the portion of the quote to the left of the decimal point. For example, if the price quote for the stock is $56.25, the handle is $56, eliminating the value of cents in the quote. Handles are often used in futures and equities markets, where they are also known as the big figure, or “big fig”.
“From a raw fundamental perspective, a two-month delay in the 2.0 Bcf/d facility would equate to 120 Bcf — largely offsetting the 135 Bcf bullish weather shift over the past 10 days,” EBW Analytics Group analyst Eli Rubin said Tuesday. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. A pip is the smallest price increment tabulated by currency markets to establish the price of a currency pair.
After Nymex futures settled Tuesday, Freeport LNG issued a lengthy statement addressing the causes of the June fire. In the statement, the company also vowed to ramp up staffing by more than 30% in an effort to improve safety and performance. A regular-way trade is settled within the standard settlement cycle, which, depending on the transaction type, can range from one to three days. Also known as the big figure, the handle is used to quickly convey the general price level on a security or index.