In their first opportunity following the record-setting snowfall in the Northeast over the holiday weekend, natural gas traders bid the market higher in overnight (Monday) Access trading. However, the market could not sustain its early push above the $6.00 mark and sellers were eager to beat it back late Tuesday morning. The March contract finished at $5.911, up 6 cents for the session but more than a dime off its $6.02 top for the session.

After having been closed since 1 p.m. EST Friday for the holiday weekend, Nymex reopened with a bang Monday evening at 7 p.m. Buyers were dominant in the computer-only Access session, lifting the market higher overnight and inducing a gap-higher open for the regular open-outcry session Tuesday. Traders agreed the gains were tied to the unexpected severity of the winter storm that ripped through the Northeast Sunday, Monday and Tuesday. Cash prices reacted sympathetically to the record snow, with prices for New York-area deliveries topping out near the $12 mark.

Also of bullish influence Tuesday were expectations ahead of this week’s storage release. Following last week’s slightly bearish 150 Bcf withdrawal, traders have been anxious to see whether this week’s release would sway market sentiment back in favor of bulls. Citing heating degree days that ran higher than previously forecast, Thomas Driscoll has upped his withdrawal estimate to 205 Bcf from 160 Bcf. If he is right, the net takeaway will be undeniably bullish versus the year-ago drawdown of 124 Bcf and the five-year average withdrawal of 91 Bcf.

Kyle Cooper of Salomon Smith Barney calls for an 189-199 Bcf withdrawal, which — along with the latest temperature forecasts — set up what he believes is the possibility for ending inventory levels on April 1 to dip to the 700 Bcf level. And while he admits that this creates a bullish scenario going forward, he would rather short the March contract from these lofty price levels. “Once again, a slightly bearish price view is taken from these price levels and consider the recent $6.07 high to offer some formidable resistance…We remain short March natural gas and long April at a 35-cent premium,” he wrote in a note to customers Tuesday. April closed at $5.71 Tuesday, making his trade about 15 cents in the black.

In daily technicals, March was able to probe past psychological resistance at $6.00, but may need to close above there to have a chance at earlier highs of $6.07 and $6.111, says Tim Evans of IFR Pegasus in New York. “If the market manages to post new highs, we’d look for projected selling in the $6.20-25 area as the next step higher,” he wrote in a note to customers Tuesday. On the downside, support is first seen at the $5.86-88 chart gap notched by Tuesday’s higher open. A breach of that level could send the market down to the intermediate-term pivot at $5.66-70, he added.

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