Much like Charismatic, winner of the Preakness and the KentuckyDerby,the futures market was off to the races Monday. Afteropening slightly more than a penny below Friday’s settlement price,the futures market spiked dramatically higher in the first hour oftrading as local buying pushed the market through last week’s$2.315 high. June continued higher yesterday afternoon, finishingup 5.5 cents to $2.343.

A Gulf Coast trader said natural gas futures were pushed higherMonday by a reaction to a couple nuclear units coming offline,which caused a 5% spike in power prices. Cash prices for index gas,he continued, are also bullish. “Last winter you were lucky to getindex plus one. Now index plus one and three quarters are poppingup everywhere. In fact, prices are so attractive that people areusing storage gas to take advantage of index premiums figuring theywill be able to replace those supplies with cheaper gas at a laterdate.”

A Chicago trader took a much more technical-based approach whilepointing to last Thursday’s double bottom at $2.17. “Since then wehave had three sessions in a row with a higher high and a higherlow. And each of those days has featured a settlement in the tophalf of the trading range. I look for prices to continue higher[today] and possibly take out the prior high of $2.40,” hespeculated.

Looking ahead to this Wednesday’s American Gas Associationstorage report, the aforementioned Chicago trader looks for aninjection slightly less than last year’s 92 Bcf build.

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