July natural gas futures struggled to make it to the “plus” column Tuesday, but in spite of the firm finish short-term traders are anticipating a period of weakness before any further market advance. At the close July added 1.9 cents to $12.952 and August tacked on 1.8 cents to $13.055. July crude oil skidded 60 cents to $134.01/bbl.

“I’m kind of looking for a little pullback from here,” said a New York floor trader. He admitted that last week he was looking for the market to trade up to $13.50, but “I think the market might trade down to $12.50 first.”

He noted that the market moved higher right at the open, but fell to test a support area at $12.84 and moved higher at the close. “It held the support area perfectly, and bounced back pretty good and led you to believe that we would come in a little better and test higher [Wednesday], but I’m not totally convinced the market is ready to run up just yet. I think the market will test $13.40, but I think it will pull back 30 to 40 cents before it runs back up,” he said.

Pullback or not, in the longer-term technical traders don’t see any reason to change their bullish outlook. “You just have to appreciate how technically strong this market is,” said George Ellis, a director at Bank of Montreal in New York. Savvy observers like Ellis, however bullish they may be, always have a point at which they will call themselves wrong.

“The market has to stop making new highs [for the uptrend to end].” He added that the market wasn’t even close to approaching nine- and 18-day moving averages, and it hasn’t challenged the 40-day moving average since April.

Major eastern energy markets are forecast to enjoy unseasonable cool weather as the end of spring approaches. “An unusual dip in the jet stream has brought uncommonly cool conditions into the East that will linger through the last days of spring,” said AccuWeather.com’s Steve Penstone.

He pointed out that the jet stream was much farther south than it is normally at this time of year, and “temperatures through the week will be below normal from the Mid-Atlantic states to New England.”

The forecaster also says there are no organized tropical systems in the Atlantic and notes that westerly flow aloft is much farther south than normal, thus inhibiting the development of tropical storms. The flow extends from the southern Gulf of Mexico east across Hispaniola and Puerto Rico into the South Atlantic, said meteorologist Matthew Rinde.

Other traders are impressed with the market’s fortitude in view of a softening weather outlook and no immediate tropical activity. “The relative strength seen in this market this week is significant since it is developing with little assistance from the weather factor. The temperature outlook extending toward month’s end appears moderate for most of the main consuming regions within the eastern half of the nation while the tropical storm forecasts are showing virtually no activity at the present time,” observed Jim Ritterbusch of Ritterbusch and Associates.

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