Bears

After failing to sustain a fresh 10-day high notched yesterday morning, natural gas futures tumbled lower Monday as traders once again eschewed the long side of the market for more than a couple hours. The prompt August contract finished at $3.153, 6.5 cents lower for the day and 18.2 cents off its high water mark for the session. The losses were also seen in the out months, which, for the most part, experienced more severe losses. The winter strip declined 8.1 cents to $3.867 and the 12-month strip dropped a cool 8 cents to $3.619.

After watching July prices tunnel lower into expiration Wednesday, natural gas traders were content to take a breather yesterday, choosing to wait for new fundamental or technical clues instead of blindly reestablishing a position in August futures. As a result, the new prompt month had a hard time getting out of its own way, sifting sideways to close a scant 0.6 cents lower at $3.28.

Bulls and bears took turns yesterday in the gas pit at Nymex as light buying pressure throughout the morning morphed subtly into selling interest in the afternoon. As a result, prices did not stray very far from center with most months able to eke out minimal advances for the session. The July contract finished at $3.747, which was 1.3 cents higher on the day.

Although the screen was successful in a feeble attempt at rallying during regular-session activity, cash prices continued to fall Thursday as traders contemplated the dual market depressants of hefty volumes already socked away into storage less than midway through injection season along with temperatures that, while on the warm side, remain subpar for this time of year.

With little in the way of fresh fundamental signals from which to take a cue, natural gas futures took the path of least resistance lower Friday as traders pressured the market back below key support at $4.00. The July contract led the way, tumbling 5.9 cents to close at $3.979, just a tick off its $3.98 opening trade for the week. Estimated volume was extremely light, with just 39,677 contracts changing hands.

Amid yet another in a string of bearish storage refills, natural gas futures funneled lower Wednesday as commercial traders elected to take profits following a three-day, 75-cent price spike. Including yesterday’s 18.9-cent decline, the prompt contract has tumbled lower on nine of the last 10 Wednesdays for an average decline of 13.5 cents. July finished at $4.112 yesterday, near the bottom end of its $4.06-30 range on the day.

Bears continued to roam the gas price woods Tuesday in nearly all markets. Overly warm and power-short California was the major exception where prices for deliveries at the PG&E Citygate and at the Southern Border into PG&E were up sharply.

Adding to losses that began in the Sunday evening/Monday morning Access trading session, natural gas futures accelerated lower Monday as traders continued to price in the impact of seemingly plentiful supply in a market that is lacking a strong demand component. At the closing bell, the prompt June contract was 25.1 cents lower at $4.239. The July contract followed suit, also tumbling 25.1 cents to close at $4.314.

For the second session in a row, natural gas prices gapped lower at the opening bell Tuesday, as mounting apprehension over today’s storage report convinced traders to lighten their long exposures a little more. But in stark contrast to Monday when prices continued lower throughout the session, gas prices rebounded slightly in the afternoon, filling in the earlier chart gap. The June contract closed at $4.641, down 5.4 cents for the day.