Continuing the seesaw motion of trading over and under the $6 mark over the past couple of weeks, September natural gas futures on Monday dropped 29.9 cents to settle at $5.813. Action was fairly lively on the day as 93,882 contracts changed hands.

After an early afternoon low of $5.78, natural gas futures traded within 10 cents of the $5.80 support mark for the remainder of the day.

“While we are down significantly, we are still holding in that $5.80 area,” a Washington, DC-based broker said. “The $5.80 level is our key for the moment. If the $5.80 area breaks, I think your looking at $5.66 and then maybe $5.50 below there if it really gets going.”

As to why the market dropped, the broker said he wasn’t sure. “Crude is down as the market sort of sold off on the new terrorism warning a little bit, but not enough to warrant the 30-cent drop in natural gas.

“I don’t know specifically what has done it,” he added. “The weather, while not supportive, it’s not getting cold by any means. The move has all of the hallmarks of our friends the funds doing something, especially when there is this large of a move without a corresponding move across all categories. Part of this could be dumping the big up-day that we had July 28, but it does seem like a fund move as opposed to something fundamental.”

The broker noted that the sell-off wasn’t likely a result of Tropical Storm Alex fear, because the track of the first named storm of the year never threatened Gulf of Mexico production.

The National Hurricane Center said in its 5 p.m. (ET) briefing that Alex was moving on a slow north, northeastward path, approximately 150 miles south-southwest of Wilmington, NC. The agency forecasted that the center of the storm is expected to pass very near the North Carolina Outer Banks on Tuesday. In addition, the NHC updated its forecast to note that the Center now expects Alex to become a hurricane during the next 24 hours. Current winds are being clocked at 60 mph.

Tim Evans of IFR Pegasus noted that cooling degree day accumulations for last week came in lower than originally forecast “suggesting net injections [into storage] of 80-90 Bcf for Thursday’s DOE report, not the 75-85 Bcf figure we projected initially. This will run well above the 53 Bcf five-year average, extending a bearish storage trend. Forecast cooling requirements for the coming week are nothing especially supportive either overall, so there seems to be little to prevent prices from continuing lower at least over the next few sessions.”

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