The recent surge in natural gas futures prices became so greaton Monday that the spot April contract came within 4 cents ofreaching its all-time high trade of $2.460. However, speculatorswere quick to “pounce on a selling opportunity” at that price, theresult of which left April up just 0.8 cents for the day at $2.351.Total volume was estimated at 88,053 contracts.

One marketer wasn’t surprised April fell so hard so fast becauseof the lack of convergence in the cash market. “March cash pricesreally didn’t move all that much today. While April futures werevisiting the $2.40 area, cash prices in the Gulf only traded ateither side of $2.30. There shouldn’t be that much differencebetween the two months right now. That pretty much tells me Aprilran up, and then back down, from technical trading,” he argued.

An industry analyst agreed. “April simply continued the pricesurge it started last week. However, speculators definitely had anupward objective in mind. They were successful in pushing April upclose to its previous reaction high of $2.43, and they beganselling contracts heavily during the last hour of trading,” hesaid.

Despite the late falloff, April remains nearly 5 cents abovetechnical support in the $2.295-305 area. For that reason, atechnician expects April to remain within that level and resistanceat $2.43-46 until it expires this Friday.

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