Perhaps pondering its Thursday expiration, the September natural gas futures contract traded in a muted range on Tuesday as fundamentals remained bleak and technical support remained rigid. The prompt-month contract closed out the regular session at $2.882, down 4.1 cents from Monday’s finish.

After trading within a 10-cent range between $2.917 and $2.819 within the first 10 minutes, September futures traded in an even narrower 5.8-cent range between $2.828 and $2.886 for the rest of the session.

With petroleum markets still trading at a hefty premium, one broker said he continues to be amazed that the natural gas market is actually the rational one this time around. “It is really kind of funny to say this about the natural gas market because it has always been the ‘wild child’ of the energy sector, but natural gas has been the only market recently that has been showing any signs of reality towards fundamentals,” said Steve Blair, a broker with Rafferty Technical Research in New York. “The market’s recent decline just goes to show that we have more gas than we know what to do with. The market has realized that the economy is down and that industrial demand is in the toilet.”

Blair said a “dusting off of history books” might be in order as the market is currently butting up against some pretty significant support from some time ago. “From a technical perspective, we have a major trendline — slightly upsloping — that extends back to 1992 when the market made a low around $2.500,” he told NGI. “That low from 17 years ago created a trendline that starts around $2.750, so there is major support between $2.500 and $2.750. We saw a nice bounce off that support on Monday when we recorded a low of $2.726. I think we’ll likely test that support again, but I doubt we’ll get below it. Every trader has this price level identified. It is no secret.”

Blair said there are not too many factors that could create a near-term rally of any significance. “The only thing I see moving us higher in a big way in the near term is a hurricane in the Gulf of Mexico. We’re too late in the summer for a long streak of scorching weather, and even if we got it, I think there is entirely too much gas in storage for it to much matter. Some of the recent analyst reports are projecting more than 4 Tcf in storage by the end of the injection season. That is a ridiculous amount of gas. We also know that the global and domestic economies are not going to turn around on a dime.”

Weather bulls may get some help in the form of expected increases in cooling load in key energy markets. The National Weather Service predicts an increased number of cooling degree days (CDD) for the week ending Aug. 29. New England is expected to see 44 CDDs, or 21 more than normal, and New York, New Jersey and Pennsylvania are forecast to experience 51 CDDs, or 15 more than normal. The Midwest from Ohio to Wisconsin, however, is expected to see 34 CDDs, or one fewer than normal.

The higher accumulation of CDDs, however, is not reflective of longer-term weather patterns going back to last winter. “We have been in a cooler-than-normal pattern since last November. Until something changes in that regard, cooler readings seem to be the default mode in this country,” said Peter Beutel of Cameron Hanover. He added that the thinking is that these cooler temperatures could usher in an early shoulder period, especially if they continue beyond mid-September. “Normally, the second half of September and most of October are mild periods during which little cooling or heating is needed.”

In the tropics AccuWeather.com is monitoring a “cloud mass” currently north of Puerto Rico, which is giving “every indication that it will become Tropical Storm Danny within 36 hours,” said John Kocet, a meteorologist with the firm. The current forecasted path was unknown, but Kocet said “the atmosphere is ripe for tropical development in all regards.”

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