With little in the way of fresh fundamental news to go on,natural gas futures traders were forced to trade purely on instinctyesterday, producing another in a string of quiet trading sessionsat Nymex. After matching but failing to surpass Wednesday’s $5.37high, the April contract was left to tumble lower throughout theafternoon. The prompt contract finished on a weak note, off 6.5cents at $5.285.

Yesterday’s prices action seemed to have a little something foreveryone. Bulls were encouraged by the market’s ability to remainwell above Wednesday’s $5.18 low. Bears, on the other hand wereimpressed by the lower closing price.

“The market started out balanced and tried to poke higher, onlyto shift lower in the afternoon,” said a broker. “The market seemedto lack leadership in either direction.”

Looking ahead, fundamentalists believe the market will be testedto the downside either today or early next week as traders price inthe latest weather outlook. According to the latest eight- to14-day forecast released yesterday by the National Weather Service,above normal temperatures are expected across roughly the northernhalf of the country while normal temperatures will be seen in thesouth.

On the technical front, natural gas is trading between some”nice numbers of support and resistance,” said Jerry Rafferty ofNew York-based GPR. “Ever since April became the spot contract, wehave been seeing some very nice two sided trading opportunities.For the moment, the key minor numbers are either $5.380 or $5.430on the upside and $5.175 as minor support on the downside. When themarket breaks either side of these minor numbers, we expect a testof the more major numbers. We believe it will be to the upside. Allthe more major signal are bullish,” he said.

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