November natural gas futures were trading 2.2 cents higher at $3.160/MMBtu shortly before 9 a.m. ET Tuesday as forecasters noted cooler trends in the outlook for early next month, offset by heating demand losses in the medium-range.

NatGasWeather noted a mix of warmer and colder trends in the forecasts overnight.

“The overnight data wasn’t quite as cold across the Midwest and Northeast the next 10 days in most datasets to lose some demand, but then not quite as warm Nov. 4-6 over the southern and eastern U.S. to add a little a demand back,” the firm said.

The European model was the exception, trending “considerably milder” through Nov. 2 to drop more than 12 heating degree days during the period, NatGasWeather said. The European trended somewhat cooler Nov. 4-6, “but still with a mostly mild setup across the South and East.”

“Any further cooler trends after Nov. 4 and the pattern wouldn’t look nearly as bearish, so it will be of considerable interest to see how the data trends the next couple of days,” the firm said.

Storage deficits, expected to widen with this week’s Energy Information Administration storage report, continue to provide a bullish background state.

“Deficits are likely to improve at least some on the milder first week of November pattern, but still not an exceptional amount,” NatGasWeather said. “The weather data remains critical as the markets search out for when the back end of the 15-day forecast will again become colder than normal across the northern and eastern U.S. since it’s possible the milder pattern might only last around five days.”

Based on balances as of late last week, including supply impacts from Hurricane Michael and the pipeline explosion in British Columbia, as well as shoulder season maintenance, Energy Aspects analysts said they now expect end-October inventories of 3.17 Tcf. This “equates to last year’s stocks for the week ending Dec. 29, and without a single day of weather in the ”official’ withdrawal season…

“For short term balances, weather will continue to sway our end-October inventory positioning, but current forecasts, together with earlier late-season heat, have put an end to any type of robust shoulder season injection period,” analysts said. “Cash remains supported for the variety of reasons that have propped it up in recent weeks — namely a gaping hole in storage and weather-aided demand, which is now transitioning to the prospect of meaningful early heating season demand.”

Looking at the technicals, ICAP Technical Analysis analyst Brian LaRose pegged $3.110-3.073 as “ideal support” if attempting to make the case that Monday’s sell-off was part of a corrective move off the recent $3.368 high.

“If this pullback is just an extended rest stop for the bulls, natural gas should be able to find support in this vicinity,” LaRose said. However, based on recent market sentiment readings, this “could prove difficult. We suggest keeping a very close watch on the technicals for any signs of bottoming action.”

Shortly before 9 a.m. ET, December crude oil was trading $1.14 lower at $68.22/bbl, while November RBOB gasoline was down about 3.3 cents to $1.8741/gal.