The June Nymex natural gas contract failed to show thevolatility normally associated with the final trading days of a gascontract by limiting itself to a narrow five cent trading range onTuesday. This tight trading band held June to a slight 0.1 centgain to $2.095.
And if the June bidweek market is any indication, the Junefutures contract probably won’t do much else today either.”Producers aren’t scrambling to unload any gas, and buyers seemedresigned to the fact that prices probably aren’t going to go muchlower. It’s as if people are just waiting around for some unlikelyevent to push prices one way or the other, while all the whileknowing nothing is going to happen. That means June will likelyexpire pretty close to where it is now, so don’t expect too muchfun [today],” a Midwest marketer said.
July, however, is a much more interesting contract in that it iscurrently facing a technical crossroads, so said an analyst. ” Onthe one hand, the contract remains just below what until recentlywas an up trendline, so that is bearish. On the other hand,speculators are still way net short, so there’s going to have to besome buying coming in at some point. Any buying that pushes Julyabove support at $2.11-12 will likely lead to further buying,perhaps driving July up to into the upper $2-teens,” he guessed.
Of course, the last several weeks have proved that a high AGAstorage report could prevent that from happening. Another analystbelieves that if tonight’s report is higher than last week’s 92 Bcfinjection figure, the market may have the ammunition it needs tomake another run at breaking below $2.00. Such a move would havefollow through support in the $1.95-97, he said.
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