“Orderly” and “quiet” are not words that typically describe thenatural gas futures market-especially during hectic expiration-daytrading at Nymex. However, yesterday they were fitting descriptionsof a market that was only able to inch higher amid light commercialshort-covering. The June contract closed out its tenure as theprompt month with a 2.6-cent gain to settle at $2.226.

“[Wednesday’s] expiration was as calm as any I can remember, aGulf trader said, adding that the choppy buying and selling youusually see was almost perfectly balanced yesterday.

However, June’s expiration was not the only thing on themarket’s plate yesterday. Fresh supply and demand data from theAmerican Gas Association (AGA) and the National Weather Service(NWS) was released yesterday afternoon. Although that news came toolate to impact the June contract, it did have an immediate bullisheffect on the rest of the Nymex strip. The AGA struck first byreleasing its latest storage report, which featured a 73 Bcfinjection into the ground. However that refill fell short of marketexpectations centered on 80-100 Bcf, and last year’s 92 Bcf build.Moments later the NWS released its latest six- to 10-day forecastcalling for above and much above-normal temperatures for almostthree-quarters of the nation extending from west of the Rockies tothe Atlantic Ocean. Only California and Nevada are expected to seebelow-normal readings, the NWS said.

The July contract wasted little time reacting positively to thefundamental news, spiking a nickel higher to $2.26 in last night’sAccess trading session. But despite the market’s eager gains lastnight, a Southeast trader remains bearish. “This is only aknee-jerk reaction to the storage report. We could retest the $2.30level, but in the end this market is headed lower,” he speculated.And who will be the ones to push it lower? “Locals who will begunning for fund sell stops in the $2.13-16 area,” he continued.

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