Natural gas futures resumed trading Tuesday right where theyleft off last week as traders pressured the market higher in twodistinct buying surges. The first one came at 10:00 a.m. (EST),when February opened a penny above last Friday’s $2.35 high onreports of the coldest air of the season for the Northeast U.S. Thesecond wave of buying came near the close, in a local-led attemptto push the spot month above its 40-day moving average at $2.385.In the end that push was only half-successful; February was able topunch through its 40-day average, but was unable to settle aboveit. The contract closed up 6.1 cents at $2.383 amid light volume ofjust 43,581.

Although hindsight is 20/20, a Dallas-based marketer insiststhis rally was in the cards and pointed to the overwhelminglybearish slant the market had during the first week of the year.”Anytime you get everyone thinking the market is going to go in onedirection, it does the exact opposite. When we gapped lower in thebeginning of January, everyone I talked to thought we were goingdown to $2.08 and $2.01.”

However, it would be incorrect to assume that her contrariantheory alone can explain the two-week, 25-cent rally. Areas fromWashington, D.C north to Maine were again treated to sub-zero windchills and ambient temperatures barely reaching the double digitsyesterday, and the cold is forecast to stick around the rest of theweek.

Looking ahead toward today’s trading session, traders will befocused on two completely unrelated factors that could have animpact on the market. The first will be the aforementioned 40-daymoving average at $2.385. “If February is able to settle above thatlevel one or two days in a row, it could prompt the [speculativetrading] funds to jump into the market,” a trader told NGI. Thesecond factor is the weekly release of fresh storage data thatmarket speculation predicts will show a 100-120 Bcf net withdrawal.Because a whopping 203 Bcf was pulled this week last year, thepredicted 100-120 Bcf range would basically erase the 90 Bcf thatstands between current working gas in storage and the record levelsseen in 1999.

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