Natural Gas Futures Maintain Momentum Amid Strong Heating Demand, Eclipse $6 Price Handle

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.

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 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.

handel in futures

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.

Natural Gas Futures Maintain Momentum Amid Strong Heating Demand, Eclipse $6 Price Handle

The timing of the 2.0 Bcf/d Freeport LNG terminal’s return to service has captivated the market because the prospect of potential delay into 2023 hampers the export demand outlook. Back in domestic territory, equities have so far held up this week after a lighter CPI reading Thursday spurred an outsized relief rally. October’s Producer Price Index , another key inflation gauge, rekindled that optimism in Tuesday’s session, along with comments from Federal Reserve members in recent days that suggested a possible slowdown in rate hiking. “The same storms producing snow across the Plains Monday will shift eastward, bringing with it a swath of accumulating snow from Michigan and Indiana to Maine,” AccuWeather senior meteorologist Paul Walker said Tuesday. The build lifted inventories to 3,580 Bcf and brought underground stocks within 2.1% of the five-year average.

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.

  • Looking ahead to Thursday’s U.S. Energy Information Administration inventory report, analysts are looking for a relatively plump storage build.
  • Charles has taught at a number of institutions including Goldman Sachs, Morgan Stanley, Societe Generale, and many more.
  • The first round of snow was expected to push all the way to the Northeast this week.
  • These include Southern Natural Gas, Texas Eastern Transmission, Tennessee Gas Pipeline and East Tennessee Natural Gas, and Algonquin Gas Transmission.
  • Back in domestic territory, equities have so far held up this week after a lighter CPI reading Thursday spurred an outsized relief rally.

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.

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.

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”.

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“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 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.

handel in futures

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.

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.

NGI’s Spot Gas National Avg., meanwhile, shed 17.0 cents to $6.170, effectively leveling off after outsized gains a day earlier. Cash prices had surged an Tradeallcrypto Broker Review: Your Decent Forex Broker average $1.415 on Monday amid the intensifying cold. In most markets, it means the whole numbers involved in a price quote, without the decimals included.

Handles and Foreign Exchange Markets

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.

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 ATFX Overview 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.

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.

“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.

Nasdaq Futures

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 market Umarkets Broker review: Experience matters! 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.

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.

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