Gapping

After gapping lower for the second session in a row and reaching a new two-week low, natural gas futures rebounded at the close Wednesday amid a wave of expiration-day short-covering. The June contract initially dipped into the $5.70s early Wednesday, but a short-covering rally ended up boosting the contract to a final settlement of $5.945, up 4.5 cents for the session and 74.5 cents above where June began its tenure as prompt contract a month ago. Comparatively, May 2003 closed 82.2 cents lower at $5.123.

After gapping higher on Friday en route to a new contract high, the April natural gas futures contract gapped lower at the open Monday as traders alleviated overbought conditions and reacted to mixed weather forecasts. Selling was spread throughout the open-outcry session and was enough to thwart several attempts by bulls to prop up the market.

After gapping higher at the opening bell and quickly filling in a gap from the daily bar chart, natural gas futures shifted lower Wednesday as traders positioned themselves ahead of what could be another bearish storage report this morning. Although the price direction was down most of the day Wednesday, the absence of strong selling allowed the market to escape the session with a modest gain. February finished at $5.161, up 3.4 cents for the day. Volume was moderate, with an estimated 86,303 contracts changing hands.

The December natural gas futures contract was fast out of the chute on its first day as prompt month Wednesday, gapping higher at the opening bell and quickly etching a new high for the week at $4.44. However, scale-up commercial selling was seen throughout the surge and was effective at limiting the market’s upside. December shuffled quietly lower in the afternoon, closing with a 12.8-cent gain for the session at $4.389. Trading was relatively light, with only 69,400 contracts changing hands.

After gapping higher at the opening bell, natural gas futures extended to new four-month highs Wednesday as traders grappled with the possibility that Tropical Storm Isidore, which was upgraded from Tropical Depression 10 Tuesday night, would intensify on its path toward the Gulf of Mexico. The buying was seen in two distinct waves. The first surge culminated with a $3.85 high yesterday morning. After a brief sell-off, bulls were at it again in the afternoon. Light profit-taking trimmed the market’s gains and left the October contract 6.3 cents off its high for the session. However, at $3.787 the prompt month was 10.8 cents higher for the day.

After gapping lower for the second-straight session, natural gas futures shuffled sideways within a very tight range Thursday as buyers and sellers were just about evenly matched. However, the price damage that had been done in the overnight access session was undeniable and that weakness proved enough to propel December prices to new 31-month lows at $2.52 shortly after the opening bell yesterday. The contract finished at $2.551, down 12.5 cents for the session and nearly 25 cents beneath Tuesday’s $2.80 close. Heavy estimated volume of 85,193 punctuated the bears’ statement.

After gapping lower at the open, natural gas futures tumbled lower for the third day in a row and the sixth out of seven sessions as traders tested the bottom end of the market’s eight-week trading range. However, when the dust had settled and the orders counted at Nymex, it was clear that support had held, leaving traders slightly bullish heading into today’s expiration. On its penultimate day, the May contract closed 9.7 cents lower at $4.981, about 42 cents below where it was when it began its tenure as prompt month.

After gapping lower at the open, natural gas futures turned higher Monday as non-commercial accounts covered shorts initiated in last week’s three-day, 64-cent price erosion. At the closing bell the May contract was 7.8 cents stronger for the session at $5.103.

After gapping dramatically lower on the open, natural gasfutures took on the trajectory of a safe pushed out of a ten-storywindow yesterday as the market dropped to its lowest level sinceNov. 29. The expiring February contract was the hardest hit by theselling, crashing 96.3 cents lower to close at $6.293. The outmonths did not fair much better, as the 12-month strip tumbled$0.49 lower to close at $5.563.