For the third session in a row, natural gas futures see-sawed toeither side of unchanged yesterday as traders eschewed eitherbuying or selling the market outside of its recent trading range.After etching out a $2.34 low Tuesday morning, speculative buyingwas once again seen trying to push the July contract throughresistance at $2.40. But resistance held and the contract sank backto finish at $2.367, a 0.5-cent decline on the day.

A Chicago area trader said fund groups were active on bothbuying and selling fronts yesterday. “It seems like the market hasfound a nice little trading range and there were people out therebuying the low $2.30s and selling the high $2.30s.” Looking ahead,he feels that the market will have a hard time maintaining thislofty height amid mild weather and bearish storage injections.”Market expectations call for an injection of 70-80 Bcf [today],but I look for an 85 Bcf build. Despite above-normal temperatureslast week, there continued to be an economic incentive to sock gasaway in the ground.” And that spread still exists, he continued.”The [Henry] Hub traded at a 8 cent discount to futures for much ofthe day today. Why wouldn’t you take advantage of storage?”

New York-based Pegasus Econometric Group, on the other hand,looks for a 90-110 Bcf injection to be a disappointment to bullswho were looking for a lower and therefore more supportive numberfollowing last week’s early Northeast heat.

In daily technicals support exists at Friday’s $2.325 low,Pegasus said. Strong resistance at $2.47-48 will likely repel themarket, if the psychological $2.40 barrier is broken.

©Copyright 1999 Intelligence Press Inc. All rights reserved. Thepreceding news report may not be republished or redistributed, inwhole or in part, in any form, without prior written consent ofIntelligence Press, Inc.