Natural gas on Saturday traded with the negative node and settled -0.27% down at 184.6 today expected to open with a gap down as internationally prices where fall below the psychologically important $4 level as moderating weather forecasts in the US, and concerns over rising production levels dragged down prices. The CWG said on Friday that while it expected above average temperatures across the Western US states in the coming week, the firm’s six to 15 day forecast showed less intense heat was forecast in the US Midwest and East during the period. Demand for natural gas tends to fluctuate in the summer based on hot weather and air conditioning use. Predictions of below-average or above-average temperatures may prompt traders to buy or sell gas futures. Meanwhile, concerns over rising production levels also weighed on prices. Natural gas traders closely watch the rig count to gauge future supply growth. The rig count has dropped sharply from a recent peak of 992 last August, but the current level of activity is still widely expected to lead to further production gains. A drop to the 800-rig-level would be necessary to begin to balance the market, according to Baker Hughes. For today's session market is looking to take support at 184, a break below could see a test of 183.3 and where as resistance is now likely to be seen at 185.2, a move above could see prices testing 185.7.

Trading Ideas:

Natural Gas trading range is 183.3-185.7.

Natural gas down sharply below the psychologically important USD4.00 level

Market closely watch the rig count to gauge future supply growth as rig count has dropped sharply from a recent peak of 992

Pressure seen as moderating weather forecasts in US and concerns over rising production lvls dragged down prices.