The stage was set for expiration day pyrotechnics Monday at theNew York Mercantile Exchange. Bulls were confident they could addto the string of five higher highs and higher lows notched on thedaily charts last week. On the other hand, bears believed theconfluence of mild temperatures and follow-through on the heels ofFridays price erosion would set the tone early yesterday. They wereboth wrong. Except for a late and almost inconsequential bliphigher, the July contract was a model of stability yesterday, wherebuying and selling matched up nearly perfectly. July closed out itstenure as spot month up a meager 0.4 cents to settle at $2.262. TheAugust contract finished up 3.2 at $2.324.

Cash prices for both June and July moved higher as wellyesterday as traders scrambled to find gas for electric generation.Looking ahead, many traders feel that weather will continue to playa major role in the direction of the market. “There are somemarketers that are rolling the dice this month and betting on mildweather in July. And if the weather continues like it has been,that will be a smart move. However, if July stays hot, look out,” aHouston marketer said.

For at least the first week of July, it appears temperatureswill stay on the warm side. In its latest six- to 10-day forecastthe National Weather Service (NWS) calls for a huge section of thecountry to experience above and much-above normal temperatures.Only Florida and the Northwest are expected to see below normaltemps, the NWS said.

Despite the above-normal temperatures, New Mexico-based Kase andCompany looks for prices to steadily continue lower, possiblyreaching the $2.025 level.

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