March natural gas is set to open 3 cents higher Tuesday morning at $2.83 as traders factor in forecast-busting continued cold over major energy markets and an strengthening technical picture. Overnight oil markets eased.

The weather pattern continues to be dominated by bone-rattling cold for the eastern two-thirds of the country for the next two weeks, according to forecasters. Commodity Weather Group in its Tuesday morning outlook said, “Impressive [energy] demand gains this week and next are the big story as the strongest cold of the winter dominates the Midwest to East especially. The cold outbreak over the past weekend delivered an impressive result, building confidence that the next few [outbreaks] in this pattern chain will also be strong performers, especially an impending Arctic surge in just the new few days with deep sub-zero lows expected for Chicago and more single digits for the East Coast.

“The overnight models held pretty close on the concepts of a cold-dominated current week extending into next week with significant national demand gains from last Friday. However, the guidance continues to grapple with a varying moderation pace for early March. We have been taking the middle ground approach on this by favoring the shift, but adding caution owing to the lingering powerful cold air supply (and snow cover). Our view is slower than the Euro but faster than the GFS,” said Matt Rogers, president of the firm.

Market technicians are not fully convinced that even with the market’s stout 9-cent advance on Friday that conditions are in place for a sustained advance. “Did the bulls just salvage the case for bottoming action?” said Brian LaRose, market analyst with United ICAP. “Technically, Friday’s rally represents redemption for the bulls after Thursday’s meltdown. But there is still work to do. In price terms, bulls still need to get above both $3.034 (0.236 of 4.544-2.567) and $3.494 (0.236 of 6.493-2.567) just to suggest a bottom. To confirm a bottom is in place, $3.789 must then be breached,” he said in Friday closing comments.

In overnight Globex trading March crude oil fell 5 cents to $52.73/bbl and March RBOB gasoline fell fractionally to $1.6228/gal.