After an early attempt to take out prior highs was rebuffedyesterday, natural gas futures trickled down to easily establish anew low for the week at $2.19. Bears were egged on by a number offactors, which include a rapidly deteriorating technical pictureand expected weekend physical demand fall-off, sources agreed. TheJune contract finished at $2.218, down 3.6 cents for the day.

Locals, led by Sandy Trot, were aggressive buyers at the openingbell yesterday, several traders told NGI. “The market was well bidat $2.285, and you could just tell they were gunning for a breakoutabove the $2.30 level,” a Gulf trader explained. However, he addedthe problem with “going for the gusto” is that if you fail you havea large position to defend. And yesterday was not the day for thebulls because once the initial buying dried up around $2.29, abearish combination of mild weather and spiraling crude oil futurespressured the market lower. But whereas natural gas seemed eager totrend lower in sympathy with crude, it was not willing to alsofollow crude oil futures higher in late, expiration-day shortcovering.

Looking ahead to today, many traders are eager for the releaseof the bi-weekly Commodity Futures Trading Commission Commitmentsof Traders Report, which breaks down all the open positions held inthe futures market. A Houston marketer looks for bothnon-commercial and commercial traders to have reduced the size oftheir positions since the last report. The last report, which wasreleased May 7, showed non-commercials were net long over 48,000contracts while commercial traders more than offset that by holdingover 74,000 net short positions.

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