Adding to gains achieved during Monday’s impressive rebound,natural gas futures erupted higher yesterday as traders bid theJuly contract to a new all-time high for a prompt month at Nymex.After gapping higher to open at $4.65, July checked back and forth,before eventually closing at $4.686, up 12.6 cents for the session.

Opinions were mixed following yesterday’s price action. Whilesome traders were surprised it took so long for July to punchthrough the previous spot month high at $4.60, others thought itodd the break came on a day where cash prices lagged the futuresmarket by a wide margin. “I need to see some corroboration fromboth the cash market and technicals before I turn bullish on thisbreakout,” said Ed Kennedy of Miami-based Pioneer Futures. NGI’sHenry Hub price for today is $4.56, some 12 cents less thanyesterday’s futures close.

The concern, for Kennedy and others, is that yesterday’s pricespike could be a false breakout or trap for bulls who have beenwaiting for weeks for the market to move above the $4.60 level. “Ineed some confirmation from some of my technical systems[Wednesday],” Kennedy added. “We satisfied the first condition byclosing over $4.60, but I would feel a lot more comfortable if themarket takes out [Tuesday’s] highs. Yesterday’s $4.715 high nowstands as the high water mark for a prompt month contract.

Looking ahead, traders will have more than just technicalfactors on their plates today.

In addition to the usual expiration-day volatility, marketwatchers can expect fresh storage news shortly after 2 P.M. (EDT).Expectations for that report are focused on a net injection of65-80 Bcf, which if realized would surpass last week’s 64 Bcfbuild, but fall conspicuously short of both the 6-year averagerefill of 85 Bcf and last year’s 91 Bcf addition.

On its last trading day, July has support at the bottom ofyesterday’s chart gap down to $4.57. On the upside, resistance isseen at Tuesday’s $4.715 high. In after-hours Access trading, themarket had already tested support by trading down to $4.54. Julylast traded at $4.592 at 7 P.M. (EDT).

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