Without any real cold temperatures to speak of in the markets that matter, December natural gas futures pushed lower for most of Wednesday’s regular session and entered a price gap that was created almost two months ago. The prompt-month contract closed at $4.254, down 27.6 cents from Tuesday’s finish.

Looking at the last 37 days of trading, December futures reached a new low for a front-month contract of $4.229 on Wednesday. Traders were quick to point out that an old price gap could now be coming into play.

“At face value, it might not look like we’re really going anywhere, but from a daily continuation chart’s perspective, we’re making new lows,” said Julio Sera, a broker with Hencorp Futures in Miami. “If we head much lower, we are going to fill the gap created in late September, which would be the $4.035 high from Sept. 28.”

Sera noted that volumes are down and traders are really waiting on the weather to chart their next moves. “Right now, there is no real cold that has come in yet. It is very mild in much of the country, which is why there is not a whole lot of market activity,” he said. “It is pretty clear on the charts that we’ve got some good price control in this $4.200 to $5 area. If we were to break below, we’ll likely slide to $4. If the support doesn’t kick in at $4 and the temperatures remain a nonfactor, we could get a pretty big sell-off for the December contract expiration on Tuesday.”

Looking toward Thursday morning’s natural gas storage report for the week ending Nov. 13, most industry estimates predict that the Energy Information Administration will report an injection in the high teens to low 20s Bcf. The number revealed at 10:30 a.m. EST will be compared to last year’s 23 Bcf build for the similar week and the 10 Bcf five-year average injection.

Citi Futures Perspective’s Tim Evans is looking for a 20 Bcf build, while Bentek Energy is projecting an injection of 18 Bcf, which would bring inventory levels to a record high of 3,831 Bcf. The research firm said it expects a 13 Bcf injection in the Producing Region with the East and West regions chipping in 3 Bcf and 2 Bcf, respectively.

“Five out of the last six year’s injection seasons have continued through the second week in November,” Bentek said in its weekly storage note. “An injection of 18 Bcf this week means this year will be no exception. Current weather forecasts indicate the mild November weather will continue, with the possibly of extending the injection season. This is supported by both the midpoint in the Daily Range for next week as well as the weathe- based demand models in StorageCAST.”

Bentek said the four- to 10-day forecast is showing a slight increase in heating degree days, but average or above-average temperatures are still expected through Thanksgiving. “Above-average temperatures together with low holiday demand have the potential to result in an injection through the entire month of November,” Bentek said. “The last time injections were reported through the entire month of November was in 2001.”

The 8:30 a.m. EST release of data Wednesday on October housing starts by the Department of Commerce was something of a disappointment for bulls. Expectations had been that the figures would show a seasonally adjusted annual rate of 600,000 units, up from September’s 590,000 level. The actual figure came in at 529,000 units.

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