Choppy trading continued at the New York Mercantile Exchangeyesterday as the futures market was pressured lower early, only tocome roaring back in the afternoon. The February contract finishedup 3.9 cents to $1.809.

And while fundamental and technical traders painted a differentpicture of Thursday’s activity, both had a plausible explanationfor the market’s strength. A Houston-area marketer felt cashprices, which “crept” higher yesterday, gave the futures marketimpetus to recover. However, a trader said strong technical supportin the $1.73-74 level, that held yesterday, helped the marketrally.

But a New Jersey analyst took a slightly different tack lookingat storage and weather and their continuing bearish impact on thismarket. “On average Jan. 15. is the peak for winter heating demandand storage is still 74% full. So the only way for the market toget back to some semblance of a normal storage level is to makerecord-setting withdrawals going down the back half of the heatingcurve. That puts added importance on the next several storagefigures, some of which could span featuring warmer than normaltemperatures.”

He may be right because the National Weather Service (NWS)released its latest 6- to 10-day forecast Wednesday night callingfor normal and above-normal temperatures for nearly the entirecountry for Jan. 19-23. Only a small area or North Dakota andMontana will see below-normal readings the NWS said.

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