Nymex futures once again were unable to buck the downtrend andcontinued to slip lower yesterday in quiet trade. The July Nymexcontract opened below $2 before breaking through long-term supportat $1.97 only to claw its way back up near the close. July settledat $1.976, down 5.1 cents for the day. In doing so, July posted thelowest level of any prompt contract since January.

A Gulf trader believes the lack of follow-through selling in themarket when July broke $1.97 could be interpreted as bullish. “Itis an inexact science to try to predict where sell and buy stopslie, but I think the market was looking for more selling in the$1.95-97 level. Instead we got a little bit of a rebound.”

Another source was more concerned by the viscous nature of thedownturn. “What we saw today was another session adding to the slowgrind down. These small victories for the bears may come at a hugeexpense. So often is the case when we plod in one direction withdecreasing estimated volume, it is a signal of an impendingturn-around. This could lead to a bit of a springboard effect.”

However, if the market does turn higher it will need a boostfrom the weather, and it might be awhile until the U.S receivesanother blast of warm temperatures. The National Weather Service’s6-to-10 day forecast released Monday for the June 14th to 18thcalls for normal and below normal temperatures over most of thenation with above normal temperatures confined to Texas and partsof Florida, Georgia and Alabama.

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