Apprehension

Spurred by constructive over-the-counter dealings, along with alittle apprehension ahead of today’s release of fresh storage data,the July contract gapped higher at the open yesterday en route toan unprecedented 15th advance in 16 trading sessions. After makinga “head fake” lower about mid-morning Tuesday, the July contractrumbled 8.6 cents higher to finish at $4.354.

Warm temperatures in major eastern cities and apprehension aboutthe possibility of “another bullish storage report” gave bulls thereason to buoy the market higher yesterday, and they did notsquander the opportunity. Buying, led mainly by commercial traders,sent the July contract up to a retest of its previous open outcrysession high of $2.41 before settling at $2.407. Estimated volumewas 73,884.

Normally natural gas futures are influenced by a hodgepodge offactors: storage, technicals, support, resistance, supply anddemand. Of course last week was anything but normal as a hurricanewhich the market has not seen the likes of since Andrew, wasbearing down on the Gulf of Mexico leaving a wide swath ofdestruction in its wake. Now the question to be answered is whetherHurricane Georges (pronounced ZHORZH) will not only live in theminds of residents of Florida and the Carribean Islands, but alsoin the memories of natural gas traders. That was still a very murkyquestion as of Friday. One thing was becoming evident late lastweek: October’s expiration today will be anything but normal. But,despite the continued threat of storm, the October actually slipped0.2 cents to settle at $2.181 on Friday.