While the market remains flush with supply, signs of favorable fundamental shifts caught the attention of money managers and powered a natural gas futures rally that spanned most of last week and through early afternoon trading Monday.
Money managers increased net long positions to a six-week high over the past week, according to the Commodity Futures Trading Commission. This supported four straight gains ahead of Monday trading, said EBW Analytic Group’s Eli Rubin, senior analyst. Weather forecasts and lighter production added catalysts to the bull parade Monday.
“It is very likely that speculator short covering is already a source of bullish pressure across the Nymex curve, as shorts buy natural gas to close out leveraged short positions,” Rubin said.
