January natural gas was set to open about 4 cents higher at around $2.80 Friday, with the market showing signs of bouncing back from the prior day's sell-off amid continued cold risks in the 11-15 day outlook.

"Prices started to crash early Thursday morning after a notably milder break showed up in the weather data for Dec. 18-19," NatGasWeather.com said in a morning note to clients. "The overnight data maintained this break, but continues to advertise cold air will quickly return across the northern U.S. Dec. 21-23."

The firm cautioned that there's still some uncertainty given "notable differences in the weather models on the amount of cold arriving with this system, and then also whether frigid air over South Canada will be able to push across the border Dec. 24-26." Both the Global Forecast System and European models "teased this will happen in the overnight data, but both showed more work will still be required if the markets are going to believe it."

Thursday's rare December storage build, a +2 Bcf net injection reported by the Energy Information Administration (EIA), seemed to validate the selling that had occurred throughout the week.

Long liquidators seemed to be driving the selling, and "the question is how much more can they liquidate?" according to INTL FCStone Financial Inc.’s Tom Saal, senior vice president.

"I don't think producers are going to be selling these numbers," he said. Do speculators "think there's enough in it for them to push it down with the risk of mother nature coming back with a vengeance and these guys having to buy back these shorts at a loss?

"If you've got a trading range between $2.75 and $3.25, you can sell aggressively down below $3, but once you get below $2.80, 'wait a second here.'"

On the other hand, analyst Brian LaRose of ICAP Technical Analysis said in a note following Thursday's close that it "very much feels like the bulls have capitulated. So the question at hand, is there still gas in the tank to get the January contract down to the $2.553-2.516 neighborhood?

"Thursday’s breakdown beneath trend line support in the Market Vane bullish consensus reading suggests the answer is yes. Note, $2.657 is the only level of contention I have between $2.725-2.723-2.717-2.720 and $2.553-2.516."

January crude oil was set to open higher, trading up about 97 cents to around $57.66/bbl. January RBOB Gasoline was up about 2.4 cents to $1.7235/gal.