MCX Natural Gas Plunges 4.62% on Demand Softness

WHAT HAPPENED MCX Natural Gas collapsed to 264.5 INR/mmBtu at 01:27 am IST, shedding 4.62% from the previous close. The sharp reversal erases overnight gains—the contract had rallied to 282.6 INR/mmBtu at 10:25 pm IST (+2.65%)—signaling profit-taking and weakening demand sentiment. The rupee strengthened 1.01% to 95.9 INR/USD, which typically pressures rupee-denominated commodity futures. MCX Crude slipped 0.14% to 7946 INR/bbl, suggesting broader energy sector fatigue.

WHAT IT MEANS The 18-point reversal in under 3 hours indicates volatile positioning and thin overnight liquidity. For MCX futures traders, the breakdown below 270 INR/mmBtu signals weakening bullish conviction. The correlation with rupee strength (INR appreciation) amplifies downside pressure. Energy traders must reassess demand assumptions if this level holds into the morning session.

WHAT TO WATCH Watch the 260 INR/mmBtu support level—a breach would target the 255 zone and confirm the end of the recent rally. Resistance now sits at 275 INR/mmBtu.