September natural gas is expected to open 2 cents higher Wednesday morning at $2.78 as weather forecasts over key market areas once again ratcheted warmer. Overnight oil markets fell.

Overnight weather models turned still warmer. “The American and European ensembles gained demand again over the past 24 hours, and it seems like the eastern U.S. is the biggest recipient of the increased cooling degree days once more,” said Commodity Weather Group in its morning report.

“Our outlook makes warmer changes to the Midwest, East and South for the one-to five-day front part of the forecast, with slightly warmer changes also for the Midwest to East in the six-10 day. The West sees same to cooler adjustments in the six-15 day window, while the South is fairly flat for the six-10 day with some slight increases in warmth for the 11-15 day. The East Coast is also warmer to hotter for the 11-15 day today,” said Matt Rogers, president of the firm.

In Tuesday’s trading traders suggested the market was getting a jump on Thursday’s inventory report. “Some hot weather came last week, but it has cooled down a little bit,” said a New York floor trader. “I think traders are showing a little more of a play for the [storage] number this week. This week’s number is going to show last week’s stuff and I think it’s going to be a little bullish so they are taking the bull by the horns a little early.

“I think traders want to get it past $2.85 to $2.86, and they are starting early.” As if the storage picture weren’t bullish enough already, The Desk’s Early View Gas Storage Estimates in an early survey pegged the number Thursday at an average 20 Bcf, well below last year’s 69 Bcf and a 61 Bcf five-year average.

Tom Saal, vice president at FCStone Latin America LLC, says that the Cal’ 17 and Cal’ 18 annual strips are oversold. In addition in his work with Market Profile he expects the market to test Tuesday’s value area at $2.727 to $2.693 before moving on and testing a second value area at $2.682 to $2.583.

Market Profile is a breakout trading system and Saal identifies the week’s initial balance at $2.765 to $2.658. Should the market break above or below these levels buy or sell signals should be initiated. He places trading targets at $2.819 for a long trade and $2.605 for a short sale.

At 5 a.m. EDT Wednesday the National Hurricane Center (NHC) reported that Tropical Storm Gaston had strengthened to 70 mph and was 975 miles west of the Cabo Verde Islands. It was headed west-northwest at 17 mph. NHC projected its course to be east of Bermuda.

NHC is also following a disorganized system a few hundred miles east of the Lesser Antilles and moving to the west-northwest at 15 mph. It was given a 60% chance of tropical storm development in the succeeding 48 hours.

In overnight Globex trading October crude oil fell 92 cents to $47.18/bbl and October RBOB gasoline fell fractionally to $1.4158/gal.