Lifts

Some would say that bull traders have endured a year’s worth ofbearish price news already this year as consistentlywarmer-than-normal weather forecasts each Monday have been followedby lower-than-expected storage withdrawal figures Wednesday. Thisone-two combo has done a number on natural gas prices, which haveplumbed to near-record lows amid almost non-existent volatility.But for at least a day, that was a distant memory Monday asshort-covering, egged on by a slew of fundamental and technicalfactors, buoyed the prompt-April contract 7.3 cents to $1.701.

Natural gas futures closed higher after a weak start yesterdayas traders were able to look past the dismal fundamental outlook tofocus on the short-covering activity at hand. That lifted the Marchcontract a modest 3.4 cents to finish at $1.86 on its first day asthe prompt month.

Essentially nothing had changed in the fundamental demandpicture Tuesday, and late-November cash prices responded with verylittle change themselves. Minuscule softness dominated at mostpoints, and the few declines rarely exceeded a nickel. Sources indiverse regions continued to report unseasonably mild temperatures.

Traders’ opinions have varied as to the direction the futuresmarket would take this week, and so it came as no surprise Mondaywhen it tested both the upside and the downside in early trading.But, when selling dried up below the $2.10 level, the Novembercontract was free to migrate higher to settle at $2.143.

Fueled by Tuesday afternoon advances, the November contractraced out to a strong start on Wednesday. But the rally becameshort-lived when it met with a wall of selling in the mid-teens,leaving the market to finish lower at the closing bell. TheNovember contract settled at $2.041, a 4.3 cent decline for theday.