June 13 natural gas futures took a tumble earlier today falling to a low of $3.92 in a dramatic downside reversal. We have noted $3.91 as pivotal support for the June nattie contract and a move below that level could open up a freefall signaling an opportunity to book some nattie for grain dryers.
The strong decline is based on positive storage data from EIA that includes a net injection of 99 billion cubic feet (Bcf). The storage increase is long overdue and as winter temperatures have turned more summerlike, decreased demand for home heat has allowed the supply to build.
Look for more details in this afternoon's Weekly Natural Gas Report. But keep an eye on this contract and consider making a call to your preferred supplier to check local pricing. With strong gains in storage and near-term demand limited by good weather, nattie's downside potential is currently high.
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