Late Rebound Gives Bulls Hope
For the second trading session in a row, early selling pressure
was reversed in afternoon trading allowing the market to close near
its daily high. The July contract notched a $2.325 low both Friday
and Monday, but settled back up above $2.37 both days. Even
estimated volume figures were similar with yesterday's 43,630
falling just short of Friday's 45,070 mark.
"Lack of leadership" is how one prominent industry analyst
assessed the market's inability to make headway in either
direction. "There was no followthrough selling once July dipped
into the low $2.30s. There seems to be some trepidation out there
ahead of this week's storage report," he continued. Although
preliminary estimates are slow to filter through the grapevine this
week, some market watchers suggest that figures could be as low as
half the 104 Bcf injection from a year ago.
In addition to the storage situation, traders continue to point
to cash market prices, which have stayed strong despite the
somewhat ambivalent futures market direction, as an indication
there is solid demand for physical molecules of gas. Daily GPI's
Henry Hub average for today is $2.29, almost a dime more than its
Bidweek average of $2.22.
For what it's worth, tropical depression No.1 was upgraded to
Tropical Storm Arlene over the weekend. As of 5 p.m. Monday, Arlene
was 275 miles southeast of Bermuda and expected to continue to the
Northwest. Maximum sustained winds are near 50 mph and tropical
storm warnings are in effect for Bermuda. Wind sheering and
relatively cool surface sea temperatures indicate the possibility
for only minimal strengthening, the National Weather Service said.
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