Futures Eke Out Small Gain in Quiet Session
Follow-through on last week's gains and record-setting
temperatures put bulls squarely in control Monday in the Nymex gas
pit. Locals and commercials were good buyers in the first hour of
trading yesterday as they buoyed the market to its highest level in
six months. However, after the initial surge the market could not
attract fresh buying and was left to chop sideways amid a
relatively light 59,236 in estimated volume. The July contract
finished at $2.442, up 0.5 cents for the day.
A Gulf trader was surprised the futures market was unable to
tack on more substantial gains in the face of spiking physical
power and gas prices. Transco Zone 6 NY prices for today's delivery
traded as high as $2.86 and Nepool power prices were quoted as high
However, a Houston-based marketer felt natural gas prices "were
simply playing catch up" Monday after having lagged the futures
market for the first part of June. Looking ahead, he feels because
cash prices have narrowed the gap the burden now lies on the
futures market to make the next move.
If futures are able to press higher, the July contract will
encounter resistance at $2.50, ahead of more selling up to $2.64,
according to New York-based Pegasus Econometric Group. On the
downside, support exists at $2.36.
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