What do you get when you pair a fizzling Gulf Coast tropicalstorm with mild temperatures across much of the U.S.? If youanswered “lower natural gas prices,” then you were right yesterday.

Feeding off a 15-cent sell-off Monday, Nymex gas futurescontinued lower yesterday and tested support in the $4.20s. TheSeptember contract finished 8.4 cents lower at $4.234.

The hurricane front-runner so far in the “close, but no cigar”category, Beryl was downgraded by the National Hurricane Center toa tropical depression Tuesday morning as it moved across northeastMexico. As of press time last night, the storm was located 120miles northwest of La Pesca, Mexico and moving to the northwest at9 mph. By this morning, the storm will have likely dissipated.

In addition to the disappointing news on the tropical stormfront, bulls had to grapple with a bearish reaction by the cashmarket, which tumbled amid cool temperatures across much of thecountry. NGI’s Henry Hub price for today was off 19 cents at $4.23.

However, analysts question how much farther the correction willgo before prices rebound. New York-based Pegasus Econometric Grouphas been looking for this correction for some time and notes thatas long as prices hold at support at $3.98-4.00, it “would stillconstitute a higher low relative to the $3.76 low from August 1 andthe $3.62 bottom from back in July, qualifying as a normal downwardcorrection within a longer-term up trend.”

Similarly, in the absence of “new random events,” Cynthia Kaseof New Mexico-based Kase and Co. believes the market will bounceoff support no lower than $4.10.

However, the market has almost come to expect a certain randomnessof reaction each Wednesday when the American Gas Association releasesits weekly storage data, and this week promises to be nodifferent. Market expectations are focused on a 50-65 Bcf injection,which spans the chasm between last year’s 51 Bcf figure and lastweek’s 65 Bcf refill. The AGA will release its report at 2:00P.M. (EST). Please check https://intelligencepress.comfor pre- and post-release market updates.

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