The July Nymex contract gained 2.8 cents to settle Monday at$2.364, thanks in large measure to momentum the contract gainedafter it filled in the technical chart gap with its early move downto $2.295. However, the upside was capped by resistance at $2.43,and July settled right in the middle of its technical tradingrange. “July trading is pretty much in cruise control now,” asource said. “A lot of people have already gotten out of theirpositions, so I think you’ll see the rangebound trading continue[today]. However, that range is 15 cents, so trading will mostlikely be volatile, which will be the first time in months acontract has expired with a good dose of volatility,” he told GPI.

Hot temperatures continue to plague the country, a phenomenonwhich has greatly impacted the electricity market. One broker saidhe heard scuttlebutt from several of his clients that a tornadowhich knocked out generation and transmission facilities in Ohioforced hourly power prices for that market to as high as$10,000/MWh. Electricity prices have been sky high in other partsof the country as well, but the broker explained the price spikeshave yet to hit the natural gas market. “Nuclear unit availabilityhas been pretty good in the gas consuming states in the South, suchas Oklahoma, Louisiana, Texas, and Florida, and that’s been keepinggas prices in check. However, you get a downed unit in one of thoseareas, or any kind of supply disruption, and the natural gas pricescould really begin soaring,” he advised.

The broker also said traders are keeping an eye on a tropicalstorm that is brewing near the Yucatan Peninsula, which coulddevelop into the first hurricane of the season.

If the August contract is able to forge higher, look for initialresistance at $2.50, followed by secondary resistance at $2.65, thebroker said.

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