Storage, Weather Send Traders Mixed Signals
After a spirited rally Tuesday that propelled the August
contract to its highest level since July 15, the market took a
breather Wednesday as traders elected to wait on the sidelines
ahead of fresh fundamental news. The prompt month finished down 0.6
cents at $2.394 in choppy, range-bound trading.
"Locals, led by Sandy Trot were buyers on the open in an attempt
to trigger buy stops in the $2.42-44 area. But follow-through
buying dried up and they were forced to liquidate their long
positions," said Tom Saal of Miami-based Pioneer Futures. Saal
feels it might have been the bulls last opportunity for a while.
"The market's failure to put together a more substantial rally
following the hot weather forecasts may have been the coup de
grace," he said.
But just as traders were beginning to discount forecasts calling
for warm weather, the National Weather Service (NWS) upped the
ante. In the latest six-to 10-day forecast released yesterday
afternoon, the NWS looks for an even larger expanse of above-normal
temperatures. And within that swath of above-normal temperatures
covering most of the U.S. east of the Rockies, the NWS expects
much-above normal temperatures from the central Great Plains across
most of the Midwest. Only the southern tip of Florida and the
extreme West Coast will see below-normal temperatures.
The bullish weather report may have been tempered somewhat by
the weekly storage figures, however. The American Gas Association
said 91 Bcf was injected into underground storage facilities last
week, which was more than preliminary estimates of about 80-90 Bcf
and last year's 72 Bcf figure.
©Copyright 1999 Intelligence Press Inc. All rights reserved. The
preceding news report may not be republished or redistributed, in
whole or in part, in any form, without prior written consent of
Intelligence Press, Inc.