After etching a new life of contract high at $3.025, the Maycontract was hit with a wave of selling yesterday that demoted itback down to settle at $2.971, even with Friday’s close. Volume wasweak with just 51,445 contracts changing hands.

Following Monday’s sell-off, traders were mixed as to whetherthe market is running out of steam or just consolidating foranother push higher. A Chicago trader favors the former andbelieves the price rally has run its course. “This market isshowing some real signs of weakness, both technically andfundamentally. We put in a new high today and the weather isexpected to be cold all week, but yet we couldn’t manage to post again.” Other sources said gas futures tumbled lower in sympathywith crude oil futures, which dropped over a dollar to close below$24.

According to Ira Hochman of New York-based Trot TradingCorporation, yesterday’s declines could very well extend duringtoday’s session, possibly down to fill in the $2.90-92 chart gapcreated last week. However, as long as the prompt month remainsabove key support at $2.82, Hochman remains cautiously bullish inthe medium term.

In daily technicals, May has resistance at yesterday’s $3.025high ahead of the $3.13 weekly continuation chart high. Support isfound at the aforementioned $2.82 low from last Wednesday.

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