Swing

Thursday’s trading confirmed the signs from Wednesday that therecent bullishness in swing prices had reached a peak. Although afew points were flat to 2-3 cents higher Thursday, the majorityfell by several cents, with the greatest weakness occurring in theMidcontinent/Midwest and Southwest markets. Cash anticipated afutures downswing and beat the screen to the punch by starting tosoften earlier, a Midcontinent marketer said, although Nymextraders eventually wound up the day with a small gain.

A holding pattern developed Thursday at the majority of tradingpoints, which were flat to up or down a penny or two for an overallreading of flatness. The market was hardly a model of consistency,though, as price movement ranged from about two cents lower in theRockies to increases of about a nickel or more for the Appalachianpipes and Northeast citygates. High temperatures in the mid 80sThursday in the dry Northeast were a close match for those in therain-drenched South.

While many expected a bearish storage report (78 Bcf ofwithdrawals) to result in further declines in the March futurescontract on Thursday, the opposite took place. Borrowing a phrasefrom Federal Reserve Chairman Alan Greenspan, one trader said”irrational exuberance” took over at the New York MercantileExchange yesterday, which pushed the March contract up 6.4 cents tosettle at $1.829.

Incremental prices closed out the month of January once againdefying bearish demand factors. In deals done Friday, most averagesvaried little from their Thursday positions. And though traderswere separating weekend business into Saturday/Sunday andMonday-only deals due to the shift from January to February, theyreported little appreciable difference in pricing between the twotime periods.

Getting no signals from the futures trading pit, thelate-January cash market saw mild softening Tuesday. With snowyconditions covering the northwestern quadrant of the U.S., Westernpoints again tended to be flat to off no more than a penny or two.However, they were joined in small dips by several Gulf Coast andMidcontinent pipes, and Michigan citygates even managed to eke outmodest gains.

The hypervolatility in swing deals done Friday for Nov. 1-2 madeit difficult to gauge where the cash market was moving Monday. Butthe overall mix of flat to about a dime or so up or down (includingjust about all points in between) amounted to a general wash thattilted a little bit to the negative side, sources said. Besides,they added, it was generally a quiet day for most traders as theytook stock of bidweek and prospects for the upcoming days.

April swing prices showed even more strength Wednesday than theyhad in Tuesday’s trading for April Fool’s Day flow. Double-digitincreases were the order of the day at almost trading point.However, it appeared that numbers may have peaked for now sincesources reported that late deals were falling in most markets.That portends softening quotes today, they said.