Watching

After watching patiently as natural gas futures prices failed to break below support over the past week, bulls traders got their turn Tuesday. Sensing the shifting tide, locals were the first to rear their horns as they hunted for buy stops on the way up. Commercial players added to the buying, which gained popularity throughout the session and was therefore heaviest heading into settlement.

If you can’t beat them, join them. After watching prices bubble higher last week, commercial and fund traders jumped in on the buy-side Monday to drive the natural gas futures market to new two-month highs.

Tired of watching Wyoming natural gas underselling the overall market, the state has authorized up to $1 billion in borrowing authority to fund construction of natural gas pipelines to deliver Wyoming gas to market.

Tired of watching Wyoming natural gas underselling the overall market, the state has authorized up to $1 billion in borrowing authority to fund construction of natural gas pipelines to deliver Wyoming gas to market.

After watching prices bubble higher during the overnight Access trading session, natural gas bulls were treated to a gap higher opening Tuesday morning, as concerns over storm curtailments lingered. However, once the follow-through buying had run its course and resistance in the $3.88-90 area had held, prices shuffled lower in the afternoon. The November contract finished at $3.862, up 12.2 cents on the day, but down 2.8 cents from its high for the session.

After watching its stock price tumble this week following negative news about off-balance sheet transactions allegedly similar to those made by bankrupt Enron Corp., El Paso Corp. took drastic action Wednesday, announcing a plan to strengthen its capital structure and enhance its liquidity. The company’s stock price rose sharply following the announcement, ending the day up nearly 5% to $41.07, but investors were keeping a watch on reports from Washington indicating the Securities and Exchange Commission probably will take a much tougher stand on energy company accounting practices in the future (see related story).

After watching July prices tunnel lower into expiration Wednesday, natural gas traders were content to take a breather yesterday, choosing to wait for new fundamental or technical clues instead of blindly reestablishing a position in August futures. As a result, the new prompt month had a hard time getting out of its own way, sifting sideways to close a scant 0.6 cents lower at $3.28.

After watching prices lose 9% of their value Monday, natural gastraders cooled their heels yesterday in a session in which neitherbull nor bear was able make its mark. As a result, the Marchcontract began its tenure as prompt month by inauspiciously sagging3.9 cents to close at $6.097.

The good news is the lights are still on in California. But Wall Street will be watching closely this week as California legislators on one coast and the Clinton Administration on the other attempt to stop the train wreck in the California power market and rescue the traditional “widow and orphans” investments in PG&E Corp. and Edison International from the junk pile.