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October natural gas is set to open 4 cents higher Wednesday morning at $3.04 as overnight weather models turned still warmer. Overnight oil markets rose.
"[Wednesday's] demand gains are estimated to run higher than yesterday's and lower than Monday's as this new warm pattern for the Midwest, East, South appears to hold longer and stronger well into the 11-15 day range," said Matt Rogers, president of Commodity Weather Group in a morning report to clients.
"Some slightly cooler South and warmer West changes are noted in the short term 1-5 day, but then the main six- to 15-day themes are warmer Midwest, East, South with cooler Western adjustments. The warmest anomalies continue to be in the Midwest, where cooling demand is weaker this time of year, but warm to hot gains in the South and East easily help drive more last-minute demand increases for this cooling season."
Market technicians versed in Elliott Wave and Retracement don't see any reason for the bulls to get enthused, at least not yet. "Progress [higher]. But still no break out," said Brian LaRose, analyst with United ICAP in closing comments Tuesday. "So still sticking to a neutral stance for now. What would get us to assume a more bullish posture? A close above the dense band of resistance straddling the $3.100 level.”
LaRose is not about to jump on any weather-driven or otherwise bullish bandwagon "until the bulls prove they are gaining the upper hand. Would be prepared for a test of [low $2.80s] if the bulls can not get the job done."
In overnight Globex trading October crude oil rose 45 cents to $48.68/bbl and October RBOB gasoline added a penny to $1.6088/gal.