Futures Seek Fair Value on Either Side of $2.00
After opening at the pivotal $2.00 level yesterday the May
contract was held to a tight, 3.5-cent trading range, as traders
seemed willing to sell the prompt contract on moves above $2.00 and
buy the market on moves below $2.00. And similar to the price
action, yesterday's close had something for everyone. Bulls found
solace in the market's ability to finish above $2.00, while bears
were optimistic following the market's second-straight day of
losses. May slipped 1.7 cents to $2.013.
One trader was pleasantly surprised by the market's ability to
withstand the early round of selling, adding that he thought the
$1.95 level would be tested Tuesday. "Trading was limited to an
anemic range today. That is telling about the strength of this
market. We have filtered out some weak length over the past two
sessions, I look for the market to build on today's settle and
possible retest the $2.09 level as early as Wednesday."
However, another trader was skeptical the market would rally on
an "AGA-day," referring to the market's reluctance to make major
moves before the American Gas Association storage report is
released each Wednesday.
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