With long-range forecasts continuing to show a mild pattern stretching well into April, natural gas futures were trading lower early Wednesday. The expiring April Nymex futures contract was down 3.3 cents to $2.707/MMBtu at around 8:30 a.m. ET, while the May contract was off 2.4 cents to $2.727.

Weather model guidance overnight held warmth throughout Week 2 while also showing a “slightly weaker cold shot” in the near term, according to Bespoke Weather Services.

“Cold today quickly eases across the South and East through the weekend, though one final cold shot is still expected across the middle of the country early next week that briefly slides into the East,” Bespoke said. “That looks to be the last of such cold shots, however, as quickly behind that we should see milder air” flowing eastward, with any connection to Arctic air shut off.

“In fact, we may begin talking about weak cooling demand by mid-April across the Southeast, where ridging should be consistent,” the forecaster said. Overnight models added some cooling degree days to partially offset heating demand losses, but “overall forecasts remain unimpressive,” showing demand running below average for both the 15-day outlook and for the month of April.

Given loose balances and the lack of any long-range bullish catalyst from forecasts, Bespoke said it viewed price risk for the April contract as “skewed lower” heading into Wednesday’s trading, with any potential “expiry-led bump likely to fail.”

NatGasWeather said cool shots this week and next should deliver cold enough temperatures to result in near or slightly above normal demand for a few days, especially next Monday and Tuesday.

“But this looks to be the last decent cool shot for a while, because thereafter is when higher pressure is expected to build across large stretches of the country as 60s to 80s become widespread and national demand fizzles,” NatGasWeather said. “This should result in very favorable build conditions for most regions of the country April 4-10, providing a good test to see just how large injections into supplies will be this shoulder season.

“It would seem likely there should be several builds exceeding 100 Bcf based on how strong Lower 48 production is.”

Looking at the technicals, analysts with Societe Generale said in a note to clients Wednesday that they would look for natural gas to move toward $2.70.

“Evolving within a large consolidation, U.S. natural gas has once again faced a stiff hurdle at the highs formed earlier this month at $2.89, also a descending trend resistance,” the analysts said. “It formed a double top at those levels and has now confirmed it giving way to a pullback. Natural gas is likely to show a down move toward the 200-day moving average at $2.70, with next support located at $2.66, the 61.8% retracement from February.”

May crude oil futures were down 16 cents to $59.78/bbl shortly after 8:30 a.m. ET, while April RBOB gasoline was off about 2.3 cents to $1.9323/gal.