Rebounding

After thrice rebounding off stubborn support during the course of the past three weeks, natural gas futures finally broke beneath the $3.00-05 area yesterday as bears pressured the market lower with confidence that comes from having been there before. A gap lower open set tone of the trading session and bulls would never recover, watching almost helplessly as both August and September dropped to new 14-months lows and closed below $3.00. August finished at $2.939, down 14.8 cents and September more than kept pace, closing down 16.1 cents at $2.985.

Rebounding from a post-AGA sell off, natural gas futures clawed higher late yesterday as traders failed to demote prices beneath support at $4.05 for the second day in a row. At the closing bell, June futures were a penny lower for the session at $4.113. Estimated volume was relatively light considering the price action as only 66,491 contracts changed hands.

After rebounding 5% during Friday’s short-covering rally, bullsat Nymex cooled their heels yesterday as traders pressured thecontract lower on moderating weather forecasts and a less bullishtechnical outlook. At the close, the prompt August contract was off3.4 cents at $4.228.

Fundamentals began playing a larger role in a rebounding weekendmarket Friday as several sources expressed relief that thepreviously frenetic screen was beginning to calm down.

Rebounding from Thursday’s heavily predicted, albeit modestsell-off, natural gas futures turned higher Friday as tradersjumped at the opportunity to increase their length while the marketwas trading off fresh highs. After opening lower and quicklymatching Thursday’s $2.75 low, the April contract rumbled 4.2 centshigher to close at $2.825, just below its $2.83 high for the dayand only pennies less than the $2.865 life-of-contract high put inThursday. Estimated volume was solid, with 53,424 contractschanging hands.