High intra-day volatility continued at Nymex Tuesday whennatural gas futures came under selling pressure early in the dayonly to rebound late in the trading session to nearly unchangedlevels. Weak cash market prices were the talk of the market in themorning and it wasn’t until after pipeline nomination deadlines at12:30 PM eastern that futures were able to begin to recoup losses.The November contract settled for the day at $2.084, down 0.5 centsfor the day.

Ed Kennedy of Miami-based Pioneer Futures believes this markethas gotten a bit ahead of itself this past week and credits a roundof short-covering for the late-day rally. “Futures came off a bittoo fast. And, although these values are justified, but I wouldn’tbe surprised to see a test of the $2.16-18 area before the marketis able to continue lower,” he said. The $2.16-18 level representsa yet-to-be filled chart gap produced by Monday’s lower open.

The market will receive fresh supply data this afternoon in theform of the weekly AGA storage report. In contrast to the recentinjection figures that have helped to shrink the year-on-yearsurplus, estimates this week call for an refill in the 60-80 Bcfrange which could pose a threat to last year’s 77 Bcf figure.

In daily technicals November finds support at yesterday’s $2.03low ahead of the psychologically significant $2.00 level.Resistance stands at the top of the aforementioned chart gap at$2.18.

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