Bolstered by follow-through buying on the heels of Monday’s14.5-cent rally, natural gas prices pressed higher early yesterdayonly to tumble back to near unchanged. At the closing bell, Junefutures were up a scant 1.3 cents at $3.183.

Fresh accumulation of long positions by funds and locals alongwith mercury levels topping out in the 90s in the populous EastCoast for the fourth day in a row conspired to send prices higherduring the first hour of trading yesterday, sources agreed. Butwhile fundamentals and technicals were equally responsible for theprice hikes, it was clearly technicals that were at fault for thelate sell-off. “$3.23 was a key level,” said a broker with NewYork-based Rafferty Energy Group. “We couldn’t get past it andtraders sold off,” he said.

He may have had a point. Yesterday represented the fourth timethis month that prices have traded up to, but not through, the$3.23-24 area.

Looking ahead, many traders will take their next position withthe release of fresh supply data by the American Gas AssociationWednesday afternoon. Equally important as the actual report,however, is the preliminary market scuttlebutt already circulatingTuesday. The bulk of market watchers are focused on a 40-70 Bcfinjection with some going as far as to narrow their prediction to a55-70 refill. However, based on last week’s reduced heating demand,New York-based Pegasus looks for a stout, 70-85 Bcf build to be”moderately bearish relative to last year’s 72 Bcf tally.”

In daily technicals, June has support at its mid-range pivot at$3.13, ahead of heavier buying at $3.05 and $3.015, Pegasus said.Resistance exists at the aforementioned congestion at $3.23-24.

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