January natural gas is expected to open 4 cents lower Thursday morning at $3.77 as traders hone in on a government report that is expected to show far less usage of natural gas than historical norms and weather projections show little change. Overnight oil markets slumped.

Weather forecasters continued with their theme of temperature moderation and are tinkering with developments on the East Coast for next week. “Modeling continues in fairly good agreement this morning on a warm-dominated pattern with focus of strongest warm anomalies in the West to Central U.S. for the six-10 day shifting eastward for the 11-15 day,” said Matt Rogers, president of Commodity Weather Group.

“The models continue to fluctuate around a transient cool to cold trough into the East next week that delivers a brief bout of modestly colder temperatures.”

Traders will be taking a close look at the 10:30 a.m. EST release of inventory figures from the Energy Information Administration (EIA) for greater insight into the weather/storage/price dynamic that has seen January futures as high as $4.689 as recently as Nov. 21 suddenly dive by nearly $1.

For the week ended Nov. 21 the EIA reported a titanic withdrawal of 162 Bcf, but recent mild weather conditions have estimates circulating about 75% less for the week ended Nov. 28. Last year, 141 Bcf was pulled from storage, and the five-year pace is for 50 Bcf. For the week ended Nov. 28, IAF Advisors predicts just 23 Bcf was withdrawn, and ICAP Energy sees a pull of 30 Bcf. A Reuters poll of 23 traders and analysts resulted in an average 41 Bcf with a range of 23-60 Bcf.

Despite the protracted fall in natural gas futures, market technicians see a buying opportunity. “Can the bulls salvage any hope of a seasonal advance into the start of 2015?” queried analyst Brian LaRose of United ICAP. “The upper bounds of our old falling wedge cuts at $3.763 Thursday, very near to the 0.7862 and 0.852 [retracements] at $3.757-3.689.

“At this time, we stand by our previous recommendation: continue to scale down buy with a protective sell stop beneath $3.541. Would only shift to short positions on a close beneath this level,” he said in closing comments Wednesday.

In overnight Globex trading January crude oil dropped 49 cents to $66.89/bbl and January RBOB gasoline eased a cent to $1.7995/gal.