Building on Monday’s gains, natural gas futures inched higheryesterday as bulls received a boost from strength in the nearbycash market. After thwarting an early sell-off, buyers weresuccessful in bidding the February contract up 4.4 cents to closeat $2.26. That made it four for four trading sessions in which theprompt month has posted higher highs and higher lows.

Several traders were quick to point to physical prices, whichwere on the march again yesterday, as a contributing factor in thefutures gains. “Whereas [Monday] was higher on technical buying,[Tuesday] got a lift from cash,” a Gulf trader surmised. NGI’sHenry Hub index for today rose almost in step with Februaryfutures, gaining 4 cents to $2.23.

Another possible explanation for the strength in the futuresmarket is the latest six- to 10-day forecast released Mondayafternoon. According to the National Weather Service, temperaturesin the southern half of the country will remain above-normal earlynext week. However, the area that has bulls optimistic is theNorthwest quadrant of the country, which is expected to seebelow-normal temperatures during that period. Looking farther out,their optimism centers on the hope that the cold weather willgradually move from west to east next week.

Alternatively, Thompson Global Markets of New York remainsunimpressed by the weather forecast and believes the market willcave under the weight of bearish storage data to be released thisafternoon. The group looks for a withdrawal of between 120 and 140Bcf, which it notes, will pale in comparison with last year’s 233draw.

In daily technicals, resistance exists at the top of last week’sgap lower at $2.305. On the downside, congestion is seen in the$2.20 area, ahead of more stubborn support at prior lows from thedaily continuation chart of $2.165, $2.125 and $2.08.

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