HFI Recearch: NG Gets A Boost On Weather Models "Weather turned bullish for the first time in a few weeks.
Middle of December is starting out cooler than expected.
Mother nature will dominate winter gas trading.
In our last week's weekly recap, we noted that the market has effectively discounted any possibility of cold risk in December let alone January or February. We said:
Was weather bearish this week? Yes, it was very bearish.
But as natural gas prices sold off this week, the market is now implicitly saying that the risk of a cold winter is nonexistent now.
Jan and Feb 2018 contracts are trading as if the warm temperatures we are seeing for the first-week of December will persist, and for anyone that's following weather forecasts closely - that might not be the case.
Overall, weather models from GFS, ECMWF, CFSv2, and CMC are all showing cooler than normal temperatures starting after 12/7. If this persists, we should see natural gas prices trend higher from here."