In a trading session reminiscent of days long gone, natural gasfutures were somewhat subdued Friday as traders held prices withina tight 16-cent trading range. Armed with fresh weather forecastsas well as a constructive technical outlook, traders added to theirlength, not only in the prompt month, but also in the summercontracts. Being the last month left on the winter of 2001 strip,March continued to play the role as the sacrificial lamb as it waslimited to a modest 5.2-cent advance. Comparatively, theApril-October summer strip showed a little more life, rumbling 7.1cents higher to close at $5.725.

While the Mid-Atlantic was enjoying temperatures well into the60s on Friday, the talk on energy trading floors around the U.S.was of an impending cool-down on tap for the middle of the month.Confirming what private weather forecasters have been saying sincemid-week, the National Weather Service’s latest six- to 10-dayforecast released Friday calls for nearly the entire country toexperience below-normal temperatures for the Feb. 15-19 period.Normal and above-normal temperatures are expected to exist only inthe Southeastern U.S.

However, after watching prices gap lower on the open beforemoving down dramatically the last two Mondays, traders were alittle hesitant to push the envelope of their long exposuresFriday. That said, many traders admitted that they are eager tolook at revised forecasts this morning and then to tradeaccordingly.

On the other hand, if prices are to move higher early this week,they will have to do so ahead of the release of American GasAssociation storage data on Wednesday. And according to Tim Evansof New York-based IFR Pegasus, the report is likely to be bearish.”Given that heating degree days forecast for [last week] were atouch lower than the actuals for the prior period, we’d have toguess that withdrawals will only amount to 90-105 Bcf or so. Thiswill be substantially less than the 158 Bcf tally from last year,putting a further dent in the 426 Bcf year-on-year deficit. Themarket may need to have this additional bearish news out in theopen before it can trend higher more consistently,” he said.

The group looks to go long at $6.28 basis March with a trailingsell-stop at $5.98 to limit their risk.

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