For the fourth session in a row yesterday natural gas futuresopened lower and came under immediate downward pressure as tradersgrappled with warm weather forecasts. However, after notching a$2.81 low during the first hour of trading the December contractwas led higher by a combination of local and trade buying. Theprompt contract finished the day down 7.7 cents at $2.837.

Sources continued to point to warm temperatures and theresultant lack of demand as a reason for the market’s weakness.Aside from a two-day cool front passing from the Midcontinent intothe East Tuesday, the weather picture remains bearish, tradersagreed.

However, yesterday’s bearish tone could change today ahead ofthe American Gas Association’s release of the latest storage data.Preliminary expectations range from a 5 Bcf net withdrawal to a 25Bcf net injection. Last year at this time the market injected 48Bcf and the five-year average is a 15 Bcf build.

For Tom Saal of Miami-based Pioneer Futures a retracement highermay be in the cards following a late sell-off by locals Tuesday. Hecontends “the big number is $2.94,” which comes in just aboveMonday’s $2.93 high. “If we can get above there then the market canbegin to think about staging a reversal,” he said.

Initially, that prediction looked to be safe because theDecember contract was already up 3.3 cents to $2.87 in last night’sAccess trading session.

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