Buoyed by a combination of a bullish tropical storm and storage concerns, natural gas futures rumbled higher Tuesday as weak shorts propelled the market to its highest level in almost two weeks. The September contract finished 9.5 cents stronger at $3.049. The out months were equally impressive, led by the October and November contracts which each gained 9.9 cents to close at $3.142 and $3.404 respectively.

As of yesterday afternoon, the National Hurricane Center was closely monitoring a strong tropical wave located about 1,500 miles east of the Lesser Antilles Islands in the Atlantic as well as a weaker tropical wave located right over the Lesser Antilles. While the conditions Tuesday near the weaker wave were not conducive to strengthening, the conditions near the stronger wave are, and the NHC expects that system to become a tropical depression by Wednesday evening.

However, tropical storm worries were not the sole market-mover yesterday. Also of concern was today’s release of fresh storage data, which many market participants believe could be the lowest injection since the beginning of April. Most expectations are clustered throughout the 55-70 Bcf range, which would fall short of last week’s 80 Bcf announcement, but exceed last year’s 52 Bcf build. The five-year average is a 67 Bcf injection. Storage currently stands 298 Bcf more than year ago levels and 198 Bcf more than the five-year average. The market injected 43 Bcf during the week ending April 20, but since that time the weekly refill number has not once been less than 77 Bcf.

In daily technicals, resistance is seen at Tuesday’s high of $3.11, which is confluent with the Aug. 2 low of $3.095. A break higher could lead to a retest of the Aug. 2 high at $3.21. Support is seen at the psychologically important $3.00 level and then again at the congestion area of $2.90-95.

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