The June natural gas contract was set to open Friday slightly higher at around $2.943/MMBtu as overnight guidance continued to advertise hot temperatures continuing through the early part of next month, according to forecasters.

After rallying sharply earlier in the week, the June contract has continued to work higher. On Thursday June added 2.6 cents day/day after the Energy Information Administration (EIA) reported a 91 Bcf weekly injection into Lower 48 storage that came close to consensus estimates.

“As the recent rally continues to build momentum, prices could continue to inch up again” on Friday, which could challenge “resistance at $2.95 and possibly even $2.98,” EBW Analytics Group CEO Andy Weissman told clients. “The direction in which prices move is likely to hinge on weather forecasts for the first two weeks of June.

“Model runs indicate the temperatures could return to seasonal or cooler-than-normal weather in the Northeast,” Weissman said. “With 115-plus Bcf injections expected during the next two weeks, if this occurs prices could decline soon. Continuation of the recent hotter trend, however, could lead to significant further gains.”

According to, overnight weather data remained hotter through the weekend into next week, with the first part of June also trending slightly hotter.

“However, the data held mostly comfortable conditions over the East June 5-8,” NatGasWeather said. “The first week of June still looks quite hot over Texas and the South with highs of 90s to 100s, but we expect the markets would prefer to see more heat across the important eastern U.S.” for forecasts to be viewed as bullish.

“With Texas into the South quite hot, but with the eastern U.S. comfortable, we see the early June pattern as neutral, with demand near five-year averages,” the firm said. “We expect the markets will be watching early June temperatures closely as we see this being the first risky weekend to hold in some time where hotter or cooler trends will be closely scrutinized.”

From a technical standpoint, analysts with Rafferty Commodities Group said it’s not surprising to see follow-through in the direction of this week’s breakout.

“However, Thursday the market stopped just short of our first major resistance level” at $2.950, the analysts said. “As we approach the end of the week, Friday’s close will have big implications for the formations on the weekly charts. A close above the $2.893 area would constitute a weekly breakout.”

Rafferty analysts are pegging former resistance at $2.900 as minor support. “A close below our major support levels” at $2.850 and $2.820 “would suggest that the longer term sideways pattern is still in effect, in which case we would want to get out of longs and reverse to trading the downside.”

July crude oil was set to open about $1.70 lower at around $69.01/bbl, while June RBOB gasoline was trading about 4 cents lower at around $2.1900/gal.