Lamb

According to one natural gas futures trader, the June contract on Wednesday went off the board like “a sleeping lamb” as it gained one-tenth of a cent to expire at $3.538. The July contract, which now assumes front-month status, slipped five-tenths of a cent on the day to close at $3.638.

Choosing to expire much more like a lion than a lamb, April natural gas futures caught fire in Tuesday afternoon trading, jumping up to reach a high of $7.40 before expiring at $7.323, up 32.4 cents on the day.

After blasting to a price level not seen in the nearly 13-year trading history of natural gas futures, the March 2003 contract sifted lower Tuesday in another session marked by hyper-volatility and 20+ cent bid-ask spreads. March futures closed at $9.577, up 44 cents for the day, but down almost $2.50 from its new all-time high at $11.899.

It was in like a lion and out like a lamb for March’s debut asthe spot month Friday as traders took the contract higher at theopening bell only to deliver it lower throughout the rest of thesession. March finished down 1.7 cents at $2.532.

Traders put bearish fundamentals aside yesterday at the New YorkMercantile exchange when short-covering and some constructive dailychart features helped the expiring February contract spike higherin active trading. Estimated volume was high, with 134,852contracts changing hands. But despite February’s dramatic 9.6-centadvance to settle at $1.810, many doubt that the market will beable to hold on to those gains when the March contract makes itsdebut today as the prompt month.

Just as the old saying about the lion and the lamb goes, no onecan ever be sure what kind of weather March will bring. This lackof clear fundamental direction has made its way to the New YorkMercantile Exchange, where the spot April contract was unable tobreak outside of a tight $2.115-$2.205 trading range last week.Since April had virtually no room to move, it is fitting the spotmonth could settle the week only 0.8 cents higher at $2.137.