Too little, too late was the apt expression for the futuresmarket yesterday, which continued lower despite what someconsidered to be the most constructive fundamentals yet thiswinter. And so the April contract took a page out of the Marchcontract’s playbook, slipping 3.8 cents to $1.659 amid a tight,6-cent trading range. Estimated volume was high for the usuallyquiet day-after expiration with 65,714 contracts changing hands.
Several traders contacted by NGI were surprised by the market’sinability to build on the apparently bullish storage and weathernews received by the market Wednesday evening. Unlike most reportsthis winter that have featured bearish data, the National WeatherService (NWS) and the American Gas Association (AGA) released moreprice-positive outlooks Wednesday, sources agreed. The AGA reportof a 97 Bcf withdrawal last week from underground storagefacilities eclipsed both estimates calling for 55-95 Bcf and lastyear’s 77 drawdown. Moments later the NWS released its latest 6- to10-day forecast calling for a large swath of normal temperaturesacross the middle of the country.
However one marketer thought cash prices, which drifted lower inboth February and March deals, were the controlling influenceThursday. “After the expiration, Nymex almost always looks to cashfor some direction.”
And in addition to physical market signals, futures traders willreceive fresh Commitment of Traders data this afternoon when theCommodity Futures Trading Commission releases its bi-weekly report.Many analysts will be looking at that report to see if, and by howmuch the non-commercial segment of the market has increased theirnet-short position.
In April technicals support exists at Thursday’s $1.635 lowahead of the $1.53-56 area. Resistance stands at Wednesday’s $1.745high.
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