After regrouping on Thursday with a mostly neutral session, traders on Friday resumed the downtrend in natural gas futures. The December contract pushed as low as $11.215 before finishing Friday at $11.415, down 27.4 cents on the day and a whopping $1.64 lighter for the week.
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With Winter Showing Tail-lights, Bears Assert Their Control
In concert with the downtrend now in its seventh week, the natural gas futures market stumbled lower Monday as traders returned from the weekend to weather forecasts suggesting the month of March would blow in more like a lamb than like a lion.
Short-Covering Rally Fails to Sway Bearish Sentiment
After dropping 5% Thursday in reaction to the overwhelmingly bearish storage news, the natural gas futures market rebounded Friday as traders covered shorts ahead of the weekend. Adding to the bullish euphoria over the expected chill over the weekend, traders were reticent to hold short positions for fear that the market would rally if another round of chilly forecasts were issued Monday morning.
San Juan/Rockies Gains Again Defy Overall Downtrend
San Juan Basin and Rockies prices continued to disobey the overall laws of market gravity Thursday, managing double-digit gains of nearly 40 cents while other points ranged from flat to down about 15 cents. The softening was remarkably consistent as nearly all the losses were clustered within 2 cents on either side of a dime.
Cash Slips Early, But Rebounds in Late Trading
The downtrend continued Monday morning at the majority of points, with many places down a more than a dime from Friday averages. However, there was a late turnaround in some regions, including West Texas, the Midcontinent, Gulf Coast and Northeast markets, which may set the tone for trading Tuesday and Wednesday until the AGA storage report is released. Despite plenty of time to prepare last week, the colder weather appears to have caught some players off guard.
Futures Plod Lower on ‘Famine then Feast’ of News
Natural gas futures, which have been caught in a downtrend sincelast summer, ticked quietly lower yesterday in a dull tradingsession. No fresh news was seen to lift the market higher and as aresult, the March contract was free to follow the overall trend byslipping 1.9 cents to $1.776 at the close. And although the Marchcontract has only slipped 5 cents lower since becoming the promptmonth on Jan. 27, it has dropped a whopping 82.4 cents, or morethan 30% from its $2.60 high set on April 8.
Ten-Cent Decline Reminds Traders of Futures Downtrend
Natural gas futures turned lower yesterday when a mixed bag ofspeculative and non-speculative selling more than offset light fundbuying. After gapping lower at the open, the February contractquickly mapped out its small, 5-cent trading range and moved verylittle for the remainder of the session. But the price damage hadalready been done, leaving the prompt month 9.6 cents lower tofinish at $1.975 and putting an abrupt halt to a 3-day, 29 centprice spike.
January Unable to Buck Downtrend
After spiraling down in the last 30 minutes of last Thursday’sabbreviated trading session, the spot January contract gapped lowerand traded in a tight 6-cent trading range Monday as traderscontinued to test the downside of the market. The nearby cashmarket, which was trading 5-10 cents lower on many pipes, had anundeniable affect when the futures market opened at 10 AM EST,traders said. Estimated volume was robust, with 86,466 contractschanging hands.
Stock Prices Belie Company Performance
The common stocks of some natural gas companies which alreadyhad been showing a downtrend got caught in the sinkhole that wasMonday’s cliffjumper stock market and several established new lows.There was no one explanation for the declines in the stocks of someof the hardest hit, including Coastal Corp., Consolidated NaturalGas, Dynegy, El Paso Energy and Williams. Some were pointing to thecompanies’ exposure in the international arena or to declining oil,natural gas and liquids prices for the trend.
Futures Market Adjusts as Traders Take Sides
The bears were at it again at Nymex on Tuesday, prompting someanalysts to suggest the downtrend that has weighed on the marketfor over 4 months has resumed. The September contract was thehardest hit by the selling pressure, moving down 5.8 cents to$1.983 on the day.