January natural gas is seen opening 7 cents higher Tuesday morning at $3.22 as traders adjust their trading to expectations of less-aggressive and more uncertain post-Christmas cold and technicians hint at a buying opportunity. Overnight oil markets rose.

Weather forecasters are still calling for post-Christmas cold. “So while colder weather patterns are still expected beginning later this week and likely lasting through New Year’s Day, it’s still not convincing as far as how it will exactly play out, especially regarding how aggressive cold air will be pushing into the northern U.S.,” said Natgasweather.com in closing comments Monday to clients.

“There still remains good potential for very cold temperatures to occur over many regions; it’s just there has been slightly more weather and climate data to introduce some doubt on just how impressive it will be. The coming pattern remains very unstable, where slight adjustments in the track of weather systems coming out of southern Canada and into the U.S. are leading to extremely large differences in the the amount of cold air being tapped and also how far into the U.S. it pushes, especially from Dec. 27th through Jan. third. So while we still expect the eastern U.S. to be mild with periods of rain the next few days, cooler conditions will arrive as the storm over the central U.S. strengthens and tracks east [Tuesday].”

In spite of Monday’s 32-cent free-fall, technical traders versed in Elliott Wave and retracement analysis aren’t willing to give up on the bullish case just yet. “Is this a dip to buy? Is there any hope for a late seasonal advance?” said Brian LaRose, a technical analyst at United ICAP, in closing comments to clients Monday.

“While we are reluctant to give up on the bulls, we have to draw the line somewhere. But that line is still down at $2.844-2.581. [We] see this as the zone the bears need to crack to completely void the case for any sort of seasonal advance. Reminder, the bulk of last year’s seasonal advance occurred after the start of the new year.”

Tom Saal, vice president at INTL FC Stone in Miami, in his work with Market Profile is expecting the market to test Monday’s value area at $3.212 to $3.148. “Maybe” the market will test $3.522 to $3.478 if time permits, he said.

In overnight Globex trading, February crude oil gained 83 cents to $56.09/bbl and February RBOB gasoline added a couple of pennies to $1.5660/gal.