Settle

The July Nymex contract gained 2.8 cents to settle Monday at$2.364, thanks in large measure to momentum the contract gainedafter it filled in the technical chart gap with its early move downto $2.295. However, the upside was capped by resistance at $2.43,and July settled right in the middle of its technical tradingrange. “July trading is pretty much in cruise control now,” asource said. “A lot of people have already gotten out of theirpositions, so I think you’ll see the rangebound trading continue[today]. However, that range is 15 cents, so trading will mostlikely be volatile, which will be the first time in months acontract has expired with a good dose of volatility,” he told GPI.

$2.40 gas proved to be too much for July on Wednesday, as thespot futures contract fell 5.5 cents to settle the day at $2.336.July opened at $2.41, but that turned out to be its high trade forthe day as sellers were quick to liquidate positions and takeprofits ahead of the contract’s expiration this Friday.

Nymex futures once again were unable to buck the downtrend andcontinued to slip lower yesterday in quiet trade. The July Nymexcontract opened below $2 before breaking through long-term supportat $1.97 only to claw its way back up near the close. July settledat $1.976, down 5.1 cents for the day. In doing so, July posted thelowest level of any prompt contract since January.

The July Nymex contract started the week right where it left offlast Friday by probing 2.1 cents higher to settle at $2.191yesterday. After trading higher into the closing bell last Fridaythe market opened lower on Monday, briefly tested short-termsupport, then managed to retrace back up near overhead resistanceat $2.20-21. Estimated volume was a healthy 56,566 contracts.

The June Nymex contract showed what hefty storage activity cando to the market by falling 7.7 cents to settle Thursday at $2.221The only good news for bulls is that the contract managed torebound after briefly falling below major support at the $2.160level. “The market has been wounded. People ignored the storagenumbers for too long, but they can’t ignore them anymore. The 345Bcf surplus is the largest we’ve had this year, and we’ve had fourstraight weeks where we’ve added to that surplus,” an analyst toldGPI.

The June Nymex contract made its debut as the spot month byslipping 1.3 cents to settle $2.298 on Wednesday. Volume wasmoderate, with an estimated 40,133 contracts changing hands.

The May futures contract suffered a third straight day of lossesby slipping a mere 0.6-cents to settle at $2.469 in relativelyquiet trading. The session was marked by light selling as bearsprobed for sell-stops but was kept in check by buying ahead of the2.435-.440 level. A modest 31,695 contracts changed hands in asession that saw no new fundamental developments.

The May Nymex contract took time out to lick its wounds Tuesdayby gaining 2.2 cents to settle the day at $2.501. Several longtraders were concerned that May would add to its massive 17.8 centloss turned in on Monday, but good buying from the outset kept Mayat either side of $2.50 throughout the session.

The May Nymex contract rallied 5.7 cents to settle Monday at$2.409, thanks to what sources said was good peak demand buying inthe physical market. “There was definitely some peak airconditioning demand in Texas today, and that’s exactly where youwant to see it to influence natural gas prices,” one of the sourcessaid. Buoyed by that strength, May had no problem rising from itsopening trade of $2.345, which also turned out to be its low pricefor the day.