Coming into Tuesday’s session at Nymex traders agreed that oneof two things would happen-prices would either continue to spikelower in follow-though of Monday’s decline, or the market wouldtake a day to catch its breath. Those that cast their vote for thelatter were correct yesterday when the December contract slipped aslight 2.6 cents to settle at $2.279.
Despite the small losses experienced by the prompt month, aHouston source thinks the price action at Nymex was positiveTuesday. “We opened near support at $2.27 and tested the downside,but support held, and that left the market to settle not only abovethe open, but also in the top half of yesterday’s 5-cent tradingrange.
However, his bullish sentiment is the minority one, as otherslook for December to plumb lower depths before next Tuesday’sexpiry. Abundant amounts of gas in storage continues to be anegative factor for the market. Plus, relatively mild short-runweather forecasts through nearly the end of November are nothelping a market where bulls have been hanging their hat onlong-lead forecasts for normal and below-normal temperatures thiswinter, sources said.
And as if natural gas fundamentals were not dismal enough, crudeoil prices are extremely weak-trading back down to within a dollarof the 12-year lows reached in June, a marketer said. “Fuelswitching from natural gas to crude is not the type of thing that Iwould bet the farm on, but when added to other bearish fundamentalsit makes me not want to be long this market.”
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