With Reuters, Bentek Energy and the five-year average all in agreement on an 89 Bcf natural gas storage injection for the week ended June 15, the Energy Information Administration (EIA) Thursday morning really had no other option but to comply. The 89 Bcf build announcement provided a small bounce in July futures, but ultimately the prompt month settled at $7.348, down 4.3 cents from Wednesday.

Immediately following the 10:30 a.m. EDT report, July futures climbed from $7.350 to $7.410. The prompt month reached its high for the day of $7.500 shortly after 11 a.m. before weakness once again set in. Over the first four days of the week, the July contract has dropped a total of 57 cents. However, scaled-down buying has appeared, which could mean time is running out for this move lower.

"While there was a little bit of a futures bump higher on the number, the storage injection amount was expected," said Ed Kennedy of Commercial Brokerage Corp. in Miami. "All of the industry's estimates were either dead on in their prediction or were only one or two billion cubic feet off, so the actual injection couldn't have been more in line with expectations."

Kennedy reaffirmed that the trading range is still intact. "We are just locked in this trading range, and I really don't see anything out there that is going to kick us in one way or another," he said. "There is nothing to speak of to give us fur and claws or hoofs and horns. While there are bulls and bears, this market is a tortoise. Before the end of the week I think we will rebound back toward $8, but that general resistance area will likely hold once again."

As for heading much lower in the current move, Kennedy said he doesn't see much if any room to run. "From here on down you are running into scaled-down buying at each penny. The song remains the same."

Jay Levine, a broker with enerjay LLC, said, "The high 80s was what the market was expecting, and that was exactly what the market got. We'll see if today's number is the catalyst for any price change if not sentiment shift, since this market could certainly use a leg-up and a change in direction. I'm still of the opinion, weak as it is, that [July natural gas] settles higher than [June] did ($7.591) but that's still a week away and anything can happen until then."

Short-term traders were expecting continued price weakness following four days of lower closes. "There is a decidedly bearish tone to the ring, and I think there is room to trade down to $7.20," said a New York floor trader.

Some bulls are gasping for air. Phil Flynn of Alaron is long the July contract from $7.80 with a stop loss order of $7.30.

The 89 Bcf build came in above last year's 79 Bcf injection, thus continuing to close the deficit to last year's storage levels. As of June 15, working gas in storage stood at 2,344 Bcf, according to EIA estimates. Stocks are 121 Bcf less than last year at this time and 365 Bcf above the five-year average of 1,979 Bcf. The East region injected 60 Bcf, while the Producing and West region chipped in 16 Bcf and 13 Bcf, respectively.

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