Rebounding from the 18-cent setback suffered by the market Friday, natural gas futures rebounded Monday as technical bullishness mixed with sympathy buying following the run-up in crude oil futures. In a mirror image to Friday’s session when prices shuffled lower throughout the day, Monday’s natural gas trading action saw its highest prices near the 2:30 p.m. EDT closing bell.

The April contract finished at $5.253, up 12.5 cents for the session. Volume was light, with just 49,816 contracts changing hands.

Traders polled by NGI Monday were quick to point to technical buying following Friday’s plunge to key support levels as a reason for the day’s price strength. By dipping below, but settling above key support at $5.08 on Friday, bulls were in the drivers seat when the market opened this week.

Also working in bulls favor, traders agreed, was strength in the nearby crude oil pit. May crude rebounded from a nearly two-week price slide by advancing $1.75 to $28.66 on news Monday that ChevronTexaco Corp. had shut down and evacuated its oil and gas production concerns in Nigeria after fighting between ethnic militants and government forces appeared to be escalating on Monday. Nigeria, the fifth-largest petroleum supplier to the United States and likely a major liquefied natural gas supplier in the future, has been undergoing substantial economic reform under a new civilian administration as it transitions from a military government (see related story this issue).

However, technical wrangling and civil strife in Africa were not the sole reasons for the natural gas price increases Monday. Also supportive were weather forecasts, which call for a return to cooler-than-normal temperature readings for the eastern half of the country. “The forecast for cooler temperatures in the Northeast next week may have tipped the balance for the natural gas market, helping to avert a decline to new lows, even if it failed to inspire that much strength,” wrote Tim Evans of New York-based IFR Pegasus in a note to customers Monday. However he is quick to note that because the below-normal readings are set against a seasonal warming trend, they will lack the punch that they had in January, February or even March.

With weather of somewhat diminished importance until cooling season begins in earnest in June, fundamental traders will have to look elsewhere for their price clues. That will lead them to the weekly supply data offered up by the Energy Information Administration in the form of the U.S Working Gas in Underground Storage report. Noting that degree days heating were a tad higher than originally forecast, Evans calls for the Thursday morning report to feature a 20-40 Bcf withdrawal, which if realized, will fall short of last year’s 75 Bcf takeaway.

In daily technicals, April’s first obstacle to the upside is selling associated with Monday’s high at $5.28. Once higher, the contract might have a fair shot at last Thursday’s high at $5.62. On the downside, support is seen at the aforementioned $5.08 level. Residual buying is possible at the psychologically important $5.00 if the market can withstand the sell stops believed to be waiting below $5.08.

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