Adding to hefty losses going back to last week’s contract rollover, natural gas futures retreated in early trading Monday as weekend weather models moderated. The September Nymex contract was down 32.0 cents to $7.909/MMBtu as of around 8:45 a.m. ET.

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Over the weekend weather models trended cooler for the first half of August, though the temperature outlook continued to point to above-average demand the next two weeks, Bespoke Weather Services told clients early Monday.

“We still have some impressive, near-record hot days this week” in terms of national gas-weighted degree day totals, “and every single day of the 15-day forecast is projected to be hotter than normal,” Bespoke said. “As such, it is still a supportive weather picture overall.”

Production also reached a new high over the weekend, combining with the cooler weather trends to help send prices lower, according to the firm.

“Now, we do see a drop in production of more than 1.5 Bcf in today’s data, but keep in mind we often see these declines on the first of a new month, only to wind up revised back higher,” Bespoke said. “We maintain a neutral view here for now, with the idea still being that there can be some near-term pressure, but over the next few weeks, if we continue to see heat in the forecast, risk of another rally will grow.”

Going back to last week, price action shows the market continuing to “consolidate July’s massive run higher,” EBW Analytics Group senior analyst Eli Rubin said.

Still, “there are significant signs of support,” Rubin said early Monday. “Phantom first-of-month production drops are curbing supply this morning, the August forecast still features record heat and the 20-day moving average crossing above the 100-day moving average may provide technical support.”

ICAP Technical Analysis pegged $7.855, $7.607-7.560-7.539, $7.372, $7.016 and $6.888 as the key support levels that “must be broken” in order to prove that the pullback in prices indicates a “significant top” forming.

“Forced to treat any sideways to lower price action as corrective in nature unless the bears can make some serious headway in breaking support to start the month,” ICAP analyst Brian LaRose said.