Despite some market expectations of a return to storage injections in the Energy Information Administration’s (EIA) weekly report Thursday for the week ended Nov. 10, natural gas futures traders on Wednesday once again broke above the psychological $8 level in the December contract. But unlike previous breaks, this one ended up holding as the prompt-month reached a high of $8.180 before settling at $8.120, up 14.3 cents on the day.

The settle above $8 was significant in that it broke a streak of failures at that level. In the two-plus weeks since December took over the front-month position, the contract had ventured above $8 on six separate occasions, only to be met by stiff selling each time.

“I think we are trying to paint a bullish picture here,” said Tim Evans, an analyst with Citigroup in New York. “If that is successful in drawing enough money to the market then futures can climb in spite of the fundamentals rather than because of them. It’s primarily a psychological proposition, which is relatively difficult to forecast. I am always more confident that a bubble will eventually pop than I am that one will develop.”

Using last year as an example, Evans said it was much easier to make money on the way down from the all-time high of $15.78 rather than on the way up to that level. “I thought $10 was a high price and a reasonable place to take profits last year,” the analyst said. “I can’t talk people out of chasing this thing higher, but as a fundamental analyst I can’t tell anyone that this is a tight supply-demand market.”

As for the market’s near-term direction, weather still remains key. Eastern energy markets enjoyed a day of warmth Wednesday, but an onslaught of Midwest cold and rain was expected to arrive Thursday, the Weather Channel said.

Evans said that while weather is definitely important, the bias on weather is even more crucial. “The fourth quarter rule of thumb seems to be cold matters while warm temperatures don’t. People seem to be saying, ‘Wow, look at the Southeast, it is 4-5 degrees cooler than normal.’ It is not like the citrus crop is ruined here,” Evans quipped.

Tom Saal of Commercial Brokerage in Miami, in his work with the Market Profile, had been looking for December futures to test Tuesday’s “value area” in Wednesday’s session, and test it the market did. He had pegged the value area as between $7.960 and $8.187.

Turning attention to Thursday’s EIA storage report, industry expectations appear to range between a draw of 8 Bcf and a build of 35 Bcf. A Reuters survey of 24 industry players has centered on an injection of 8 Bcf, while the ICAP derivatives auction held Wednesday afternoon showed a consensus 1.5 Bcf withdrawal.

Golden, CO-based Bentek Energy projects that there will be no net change this week in working gas levels. The company predicts that an 11 Bcf withdrawal in the East region will be erased by a 6 Bcf injection in the Producing region and a 5 Bcf addition in the West region. If Bentek’s prediction comes out correct, working gas in storage will remain at 3,445 Bcf, which is still 7.3% above the five-year average and 2.8% over the five-year high. The company also noted that eight U.S. facilities continue to indicate storage above maximum capacity this week while 11 facilities are between 95% and 99% of capacity.

The number reported by the EIA will be compared to last year’s 54 Bcf injection and the five-year average build of 13 Bcf.

Because of the forthcoming Thanksgiving holiday, the EIA announced that the storage report for the week ending Nov. 17 will be released on Wednesday, Nov. 22 between 12:00 p.m. and 12:10 p.m. EST.

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