August natural gas is set to open a penny lower Tuesday morning at $2.75 as traders note little in the way of new weather information and see a technically firm outlook, at least for now. Overnight oil markets rose.

In spite of the trading turmoil in the petroleum sector Monday, Jim Ritterbusch of Ritterbusch and Associates said, “trade was unusually subdued with range limited to only some 4-5 cents. The ability of nearby futures to hold our expected support at the $2.73 level provided some feature. Violation of this support may need to await another round of EIA storage figures, given the fact that the short-term temperature views appear to be tilted in a supportive direction, with a Midcontinent warmup expected later this week and into next.

“We will be looking for a stretch in the supply surplus against average levels of around 10-15 Bcf that could prove sufficient to induce some selling should the more extended weather outlooks favor some renewed cooling. Overall, we are maintaining a bearish stance for now as we suggest holding any short August positions established above $2.82 with downside targets still valid to the $2.50-2.60 zone.”

Weather forecasts changed little overnight. Commodity Weather Group in its Tuesday morning report said, “Overall outlook continues to run very similar to yesterday’s with only minor adjustments at times. The cool push in the second half of the six-10 day for the Midwest to East looks a bit weaker today, so we softened it somewhat for a slight [energy] demand gain impact.”

Market technicians see the market as perilously close to initiating a move lower but admit that for the moment, the trend remains sideways. “Typically, from mid May to mid August we are looking for seasonal weakness in natural gas,” said Brian LaRose, a market technician with United ICAP. “So we would not be surprised to see a continued move lower over the short term. However, to trigger a short-term slide, bears need to take out $2.708. [We] see room down to $2.641-2.616, possibly even $2.490-2.406 if the bears are successful. As long as natural gas can hold $2.708, the bias is sideways to higher,” he said in closing comments to clients Monday.

Tom Saal, vice president at FC Stone Latin America LLC, said the “market still range bound (near the lower end) and weather-driven for now…Also keep your eye on forward curve as it relates to the injection season and pricing available ’empty’ storage.” In his work with Market Profile, Saal expects the market to test Monday’s value area at $2.775 to $2.757 before moving on and testing $2.875 to $2.831.

In overnight Globex trading August crude oil added 3 cents to $52.56/bbl and August RBOB rose a 2 cents to $1.9490/gal.