In concert with the downtrend now in its seventh week, the natural gas futures market stumbled lower Monday as traders returned from the weekend to weather forecasts suggesting the month of March would blow in more like a lamb than like a lion.

With that the March contract began its three-day settlement period by probing a new, 10-week low at $5.105. It closed at $5.127, down 6.6 cents for the session. At 56,342, volume was moderate to light on the day.

The market’s behavior Monday was far cry from a year-ago this week, when the futures market erupted higher on blizzard-like conditions and dangerously low storage levels. From a launching pad in the low $6.00s in February of 2003, the March 2003 contract exploded to a new 25-month high at $9.20 on that Monday. At $2.531, the advance still stands as the largest daily increase ever in natural futures trading, more than double the previous record change of $1.101 set back in December of 2000. A day later on Feb. 25, 2003 the March contract would notch the all-time prompt month high of $11.899.

And while some would suggest that looking at the history of a futures market is a frivolous endeavor, others contend that prices would not be where they are right now if it were not for the memory of last winter. “Even as recently as last week there was respect for the weather forecasts,” a trader told NGI. “There were forecasts out there suggesting the end of February would be cold….. Not cold like 2003, but below-normal for this time of year.”

As it turns out, however, those forecasts for below-normal temperatures have been revised to call for a combination of normal and above-normal temperatures for the last week of February and first week of March. Specifically, the National Weather Service calls for above-normal temperatures in the entire Northeast corner of the country for the Feb. 29 – Mar. 4 timeframe.

Having passed the heart of the heating season, bulls are hanging their hats on the idea that storage data set to be released this Thursday will show another large draw. Expectations are lining up in the 120-154 Bcf range, which if realized would easily exceed the five-year average of 97 Bcf, while falling just shy of the 154 Bcf figure from a year ago.

In daily technicals, March and April contracts have considerable support near their Monday lows at $5.10. Failure to hold that level would confirm the bear trend and likely lead to flush down to the next tract of potential buying in the $4.84-86 area, chartists agree.

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