Natural Gas Pulls Back After EIA Report

Key Insights

• WTI oil is gaining ground as traders bet that China’s demand will increase after the country relaxes its strict zero-COVID policy. 
• Gold is testing new highs as the U.S. dollar is under strong pressure against a broad basket of currencies. 
• Copper continues to rebound as traders stay focused on the developments in China. 

Natural Gas Tests Support At $6.90

Natural gas  prices are moving lower after the release of the EIA Weekly Natural Gas Storage Report.

The report indicated that working gas in storage declined by 81 Bcf from the previous week, compared to analyst consensus of -84 Bcf.

U.S. House has recently approved bill to block the rail strike. This development will serve as a negative catalyst for natural gas in the near term as those who bet that rail strike would boost demand will have to exit their long positions. If natural gas settles below the support at $6.90, a wave of liquidations may follow.

WTI Oil Settled Above $82 On Hopes For Stronger Demand

WTI oil is currently trying to settle above the $83 level as traders react to China’s plans to relax its strict anti-coronavirus measures.

China has recently had a series of protests as the country’s citizens were unhappy with the zero-COVID policy, which includes mass testing and lockdowns.

If China eases its COVID-related protocols, economic activity will grow, which will be bullish for oil markets.

Gold Rallies As Dollar Tests Multi-Month Lows

The strong pullback in the U.S. dollar provided significant support to precious metals.

Gold is currently testing the resistance level at $1800. In case this test is successful, gold will move towards the next resistance, which is located at $1815. A move above this level will push gold towards the resistance at $1830.

On the support side, the previous resistance level at $1785 will serve as the first support level for gold. If gold declines below this level, it will move towards the next support at $1775.

Meanwhile, silver managed to gain strong momentum and moved towards the $22.50 level. Platinum is trading near $1050, while palladium continues its attempts to settle above $1900.

Copper Tests The $3.80 Level

Copper  is trying to settle above the $3.80 level as traders focus on news from China. If China relaxes its COVID policy, copper will have a good chance to gain additional upside momentum and move towards November highs near the $4.00 level.

For a look at all of today’s economic events, check out our economic calendar.