Nymex bears got their Thanksgiving feast a few days earlyyesterday when they were greeted with a hearty helping ofprice-negative fundamental and technical news. And even before theopening bell sounded that sentiment was evident in the price levelas over the counter deals traded at a dime below Friday’s close.After opening at $2.34, the December contract tumbled lower to newlife-of-contract-lows before settling at $2.197, down a whopping23.7 cents or 8% for the day. Heavy estimated volume of 120,326served to punctuate the price move.

Several traders agreed that the tone was set early in the day bylower trades in both the over the counter and physical markets.Henry Hub cash prices fell to the $2.04-05 level, a marketer toldNGI. However, some would argue that the market’s fate was sealed asearly as Friday afternoon when the Commodity Futures TradingCommission released its bi-weekly Commitments of Traders report. Ofbiggest note in that report is the non-commercial speculativeposition, which flipped from to a 6,686 net short position from anearly 14,000 net long position just two weeks prior. And because6,686 is a relatively small short position and thereforesusceptible of growing larger, many traders got a boost of sellingconfidence from Friday’s report, sources agreed.

Of more immediate concern to traders Monday may have been yetanother in a string of bearish weather outlooks. In their latestsix- to 10-day forecast, the National Weather Service calls for theentire continental U.S., save the Atlantic Coast states and partsof Michigan, Wisconsin, Minnesota, Washington and Oregon toexperience above- and much-above normal temperatures to ring in thelast month of the millennium. Only New York and New England areslated to see below-normal temperatures.

Looking ahead to Wednesday’s abbreviated December contractexpiration day, traders remain mixed. While it would be foolhardyto rule out a last minute short-covering rally, a Dallas-basedtrader warns that it is not so easy to predict a contract aboutexpire. “You could have a whole slew of physical longs willing totake their financial shorts into expiration.”

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