Natural Gas Price News: XNG/USD bulls attack $2.70 despite mixed demand-supply matrix, China/US PMI eyed

• Natural Gas picks up bids to refresh intraday high after sluggish start to the week.
• Hopes of upbeat XNG/USD demand jostle with increasing output, firmer US Dollar to prod bulls.
• Risk catalysts, energy market updates eyed for clear directions of the Natural Gas Price ahead of China/US PMIs for July.

Natural Gas (XNG/USD) Price remains on the front foot around $2.70, refreshing intraday high amid the early hours of Tuesday after an unimpressive start of the week. In doing so, the XNG/USD takes clues from the expectations of witnessing more energy demand while paying little attention to the likely increase in the XNG/USD supplies and the US Dollar’s run-up ahead of the US ISM Manufacturing PMI, as well as final prints of July’s S&P Global PMIs.

On Monday, Reuters unveiled news suggesting the highest demand for liquefied natural gas (LNG) in Asia in the last six months in July, as well as a decline in the energy demand from Europe, to prod the XNG/USD bulls.

That said, Asia's imports of the LNG were estimated at 21.85 million metric tons in July by commodity analysts Kpler, reported Reuters, up from June's 21.28 million and the most since January. The news also said, “Europe's imports were estimated at 8.72 million metric tons in July, down from June's 9.06 million and lowest monthly total since August last year.”

It should be noted that the record heat in the US also signals higher LNG demand.

However, the Refinitiv data mentioned the average gas output in the Lower 48 states as 101.6 billion cubic feet per day (bcfd) for July versus 101.0 bcfd in June and the monthly record of 101.8 bcfd marked in May.

Elsewhere, the US Dollar Index (DXY) managed to remain firmer on Monday, grinding higher towards 102.00 by the press time, despite witnessing mixed US data. That said, Dallas Fed Manufacturing Business Index improves to -20.0 for July from -23.2 prior versus -26.3 expected whereas Chicago PMI rose to 42.8 from 41.5 prior versus 43.0 market forecasts.

Headlines from China and about the US Federal Reserve (Fed) seem to propel the DXY amid a sluggish Tuesday morning in Asia. That said, China's Commerce Ministry renews the Sino-US trade war fears by announcing measures to limit exports of some drones and drone-related equipment, starting from September 01, by citing the “national security and interests” late Monday suggests Reuters. On the same line is the Fed’s quarterly Senior Loan Officer Opinion Survey (SLOOS) which said the US banks reported tighter credit standards and weaker loan demand during the second quarter (Q2 2023).

Moving on, XNG/USD traders should pay attention to the risk catalyst and China Caixin Manufacturing PMI for July for immediate directions ahead of the final readings of the US S&P Global Manufacturing and Non-Manufacturing PMI for July. Also important to watch will be the US ISM Manufacturing PMI for the said month.

Technical analysis

Monday’s Doji candlestick on the daily chart joins a five-week-old descending resistance line, around $2.75 by the press time, to challenge short-term XNG/USD bulls. The Natural Gas Price, however, remains on the buyer’s radar unless breaking an ascending support line from early June, close to $2.60 at the latest.