Physical natural gas for Tuesday delivery bounded higher in Monday’s trading, recovering somewhat from Friday’s 16-cent drubbing, but also reflecting cool, stormy conditions over the Northeast.

Gains were most pronounced in the Northeast and Appalachia, but strong gains were registered in the Rockies and West Texas as well. The NGI National Spot Gas Average rose 20 cents to $2.73.

Futures traders were still licking their wounds from Friday’s free-fall, but some see the decline potentially providing a fertile base of shorts from which to stage a winter season rally. At the close December had risen two-tenths to $2.966 and January was lower by two-tenths to $3.100. December crude oil rose 25 cents to $54.15/bbl.

Next-day prices at New England and Mid-Atlantic points jumped as cooler temperatures were forecast and a major pipeline reported constraints. forecast that Boston’s Monday high of 66 was expected to drop to 57 Tuesday and 53 by Wednesday, 4 degrees below normal and 9 degrees below Friday’s high. New York City was expected to see its Monday high of 60 fall to 55 by Tuesday and 54 by Wednesday, 5 degrees below normal.

Gas at the Algonquin Citygate jumped 38 cents to $3.23 and deliveries to Dominion South added 61 cents to $1.53. Gas bound for New York City on Transco Zone 6 gained 65 cents to $2.94.

The National Weather Service in southeast Massachusetts reported that “powerful low pressure in Quebec will provide windy, cooler but dry weather across southern New England through Tuesday. High pressure builds over the area Wednesday with diminishing winds, but remaining cool. Milder Thursday, and especially Friday, ahead of an approaching cold front with temperatures rising into the lower 70s.”

Tetco M-3 Delivery posted the region’s greatest gains, adding $1.45 to $2.63 as Texas Eastern reported reduced eastbound flows.

“Texas Eastern will conduct maintenance on its Heidlesberg compressor station [Monday and Tuesday] marking the third maintenance event in the last month affecting the eastbound flows on the 36″ southern M-3 line,” said industry consultant Genscape in a report to clients. Operational capacity through the Chambersburg, Heidlesberg, and Marietta compressor stations have been reduced to 1591 MMcf/d. 1433 MMcf/d and 1309 MMcf/d, respectively, Genscape said.

Other market points firmed as well. Gas at the Chicago Citygate rose 20 cents to $3.05 and gas on El Paso Permian added 19 cents to $2.60. Gas at the Henry Hub was quoted 9 cents higher at $2.87 and packages at Transco Zone 4 gained 11 cents to $2.85.

At Opal next-day gas added 17 cents to $2.70 and gas at Malin rose 19 cents to $2.76. At the SoCal Citygate gas changed hands at $3.10, up 31 cents and gas priced at the SoCal Border Average rose 26 cents to $2.85.

Risk managers are looking for higher prices to establish short hedges. “We continue to see build in the natural gas storage which is negative for prices,” said Mike DeVooght, president of DEVO Capital. “The natural gas demand is relatively flat as we have had moderate temperatures throughout the U.S. We will continue to watch for a price increase as we enter the heat season and demand increases.

“On a trading basis, look to go long if the December and January contracts trade below $3 (December has reached trading levels). Our target to establish producer hedges is the $3.50 for the winter strip.”

Technical analysts see the sharp decline Friday as perhaps eventually setting up a winter rally.

“There were a lot of people long, insisting we would get a pre-season rally anyway,” said Walter Zimmermann of United ICAP in a webcast Friday. “I suspect that length is getting flushed out this week. The implication is that there will be a re-test of the $2.52 low if not a test of the $2.12 area. The only intervening support is where we ended up Friday down off the high of $3.43.

“The only support between here and $2.52, is $2.65, but the irony of all this is that the further natural gas sells off, the better the case for some form of winter rally.”

Other analysts see a classic duel between supply and demand setting up for the winter. “The mercury is set to drop soon, but few people (if anybody) sees a problem this winter in terms of supply in the U.S. market,” said Scott Shelton of ICAP Commodities in a morning note to clients. “It will be cooler this winter, closer to normal really, but nonetheless, the experts say that demand will indeed impress. Storage won’t break any records, but it will be close. If the next five weeks look anything like this week, we’ve got a real horse race.”