Activity in the natural gas pit at NYMEX has beenuncharacteristically quiet recently with low volatility and sub-5cent trading ranges the rule rather than the exception. In fact,the only real excitement in the past couple of weeks came Mondaywhen the July contract bounced 3 cents in a late rally. But eventhat was quickly dismissed by many traders who considered itnothing more than a freak, expiration-day anomaly in an otherwisesubdued market. Enter the August contract, which wasted little timeyesterday in moving dramatically higher in a rush of speculativeand commercial buying. The newly crowned prompt month finished up7.6 cents for the session at $2.400.

A complimentary technical picture and weather outlook is how onetrader described the rationale for the price advance. “We have hadbullish weather and bullish technicals, but we haven’t had them atthe same time,” he said.

In its most recent six to 10-day forecast the National WeatherService calls for above and much above normal temperatures over alarge swath of the center of the country. Private forecastscorroborated the NWS outlook, sources said.

But fundamentals were not the sole factor impacting prices. Abroker said local buying ahead of the 40-day moving average wasalso responsible. Locals, many of whom trade their own book andthrive off market volatility, will often push the market in apre-emptive strike toward one of the moving averages. The 40-daymoving average for August is currently $2.343.

Looking ahead, the first potential wet blanket for this marketcould come today in the form of the weekly storage figures releasedby the American Gas Association. Sources feel that an expected netinjection of 80-90 Bcf will produce bearish overtones when comparedwith last year’s 72 refill.

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