Plummeting natural gas futures continued to come under pressure in early trading Tuesday as the latest forecasts further weakened December heating demand expectations. The January Nymex contract was down 10.4 cents to $5.473/MMBtu at around 8:45 a.m. ET, adding to a 70.4-cent sell-off in the previous session.

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Fading weather-driven demand in the latest forecasts had the free-falling January contract in search of support in early trading Tuesday, according to EBW Analytics Group analyst Eli Rubin.

“In the immediate term, the January contract will search for key support to stop the bleeding,” Rubin said. “Key technical support is likely near $5.38-5.40 and, if it holds, could trigger a notable near-term rebound as shorts take profits. If support cracks, however, substantial further downside is possible, and support at $5.00 may come into question.”

The latest forecast for the six- to 10-day period (Sunday through Dec. 15) extended warmer trends over the eastern half of the Lower 48, according to Maxar’s Weather Desk.

“The forecast again trends warmer from the Plains to the East Coast, where above normal temperatures are favored for most of the period,” Maxar said. “The warmest conditions are in the form of much aboves and come in advance of lower pressure.”

Temperatures would return to “more seasonal-like levels” late in the period from the Midcontinent to the South, the forecaster added.

For its part, NatGasWeather said it was the European model that put “more salt in bulls’ wounds” with its overnight run, with the model losing 20 heating degree days (HDD) over the prior 24 hours for the 15-day projection period.

“A colder U.S. pattern is possible Dec. 17-20, although the overnight data did back off on coverage of subfreezing air to lose a few HDD,” NatGasWeather said. “This isn’t a big surprise, since the weather data keeps showing frosty patterns for the 11- to 15-day forecast period, only to trend warmer the closer it gets.”

Market participants “aren’t going to be as gullible” with forecasts teasing frigid conditions into the back half of December given the lack of realized cold for the first half of the month, according to NatGasWeather.

In the short term, the market is likely to continue experiencing volatility, EBW’s Rubin said.

“Weather models continue to show a turn sharply colder in late December that could revive a flagging January contract,” the analyst said. “Over the medium term, however, the tremendous warm shift slashes seasonal risks of a bullish outcome, and further downward pressure is likely by mid-winter — if not sooner.”