The April Nymex contract returned to its recent habit of tightdaily trading ranges Tuesday by containing its movements between$2.295 and $2.345. That tight range only allowed April to lose 2.1cents for the day to $2.330, despite the fact that nearly 60,000total estimated contracts changed hands.
While one source said the fall-off is natural, considering Aprilfailed to challenge is all-time high of $2.46 on Monday, anothersource said the news should be seen as more than just technical.”This is bad news for bulls, at least for bulls of the Aprilcontract. Relatively speaking, April has fallen pretty hard, prettyfast. The only encouraging thing for bulls is the fact that pricesrebounded after April dipped to $2.295. That shows that supportheld. If this can continue, then April should expire somewherebetween $2.30-43 this Friday,” he concluded.
A lot of where April settles may depend on cash market prices,and for that reason, one producer isn’t so optimistic. “April is aspring month, but were talking about seeing early summer -liketemperatures during bidweek. That’s never a good backdrop fromwhich to sell prices,” he said. The CNG Energy Index predictsenergy demand will range between 25%-33% lower than normal thisFriday through Sunday. However, the producer admits the overallsupply/demand balance is still “very tenuous, so I don’t expect anApril settle below $2.30,” he said.
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