Riding technical momentum and drawing support from hefty declines in the latest production estimates, natural gas futures surged higher in early trading Tuesday. As of around 8:50 a.m. ET, the September Nymex contract was up 51.6 cents to $9.244/MMBtu.

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In Monday’s session, prices rebounded after a test of support at $8.40, EBW Analytics Group senior analyst Eli Rubin observed.

“Robust technical support suggests the rally may push higher in the immediate term, with the front month already clearing the $9.00 psychological level early this morning,” Rubin said.

Day/day changes in the fundamental outlook were mixed early Tuesday, according to the analyst.

Weather-driven demand “continues to deteriorate” as updated forecasts shed cooling degree days for the central part of the country over the next few weeks, Rubin said.

“A steep drop in early-cycle pipeline nominations, however, hints at a 1.5-2.0 Bcf/d day/day decline in production that is contributing to the early surge in prices,” the analyst said.

Domestic production estimates from Wood Mackenzie as of early Tuesday showed output falling roughly 1.8 Bcf/d day/day, down to around 96.3 Bcf/d. Wood Mackenzie analyst Laura Munder pointed to coinciding pipeline maintenance or operational issues to help explain the declines, adding that revisions are “expected in tomorrow’s sample.”

The day/day production drop included a decline of around 840 MMcf/d in volumes flowing out of the Northeast, associated with various regional pipeline constraints, according to Munder.

Rockies production was down around 285 MMcf/d day/day, with Texas output down about 235 MMcf/d, the analyst said.

Meanwhile, the September contract as of early Tuesday had pushed past the first of a series of key upside targets pegged by ICAP Technical Analysis.

“The bulls need to lift natural gas over a pair of .7862 retracements at $9.015 and $9.277, and the prior highs at $9.419, $9.598, $9.664 and $9.752 to revive the up trend,” ICAP analyst Brian LaRose said in a note to clients. “Gunning for $10.268-10.299 next if they succeed. Looking for more congestion, possibly another run at the 50-day moving averages, if they do not.”