After thrice testing, but failing to break beneath support Thursday, natural gas futures rebounded at the New York Mercantile Exchange as traders put an end to a nine-day, 70-cent price slide. The June contract received the biggest buying boost, closing 4.4 cents higher at $4.527.

Market watchers were quick to point to the bears’ inability to pressure June futures below $4.44 for the second day in a row as somewhat of a victory for the bulls. However, even the most bullish of traders was disheartened by the lackluster 4.4-cent gain. “We come off nearly 70 cents and all we can muster is a lousy 4-cent gain,” complained one Houston marketer.

On the other hand, some traders were surprised the market was able to eke out even a modest gain considering the overwhelmingly bearish storage data released Wednesday afternoon. According to the American Gas Association, a record-setting (for the month of April) 102 Bcf was injected into underground storage facilities last week, bringing stocks to 26% full at 850 Bcf. With that the industry has trimmed a 404 Bcf year-on-year deficit to just 209 Bcf in just four weeks.

Looking ahead, bulls contend that the market will only truly be tested when gas demand for summer power generation load kicks in to compete with storage refills. Bears, meanwhile, point to increases in production and lost demand due to high relative prices as reasons the market will continue lower.

Tim Evans of New York-based IFR Pegasus is not ready to endorse either view. “We note that even if storage were identical with last year, that would seem to imply plenty of upside from current levels over the longer run. We won’t become long-term bears just yet, but there’s no rush to buy this market until we see some significant South heat to boost cooling demand.” Accordingly, he looks to work in 50% long position with a $4.73 buy stop, with a sell stop under recent lows to limit initial risk.

In daily technicals, June has support at the aforementioned $4.44 level ahead of more sturdy support at a continuation chart low of $4.38.

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