Natural Gas yesterday traded with the positive node and settled 1.46% up at 103 as prices bottom fishing speculators supporting the heating fuel and short position holders covering their trades offered support. Natural gas futures have been hitting a string of fresh 10-year lows over the past two weeks, as market sentiment has been dominated by ongoing concerns over waning demand and elevated US storage and production levels. Meanwhile, forecasts of warmer than normal weather across the US west coast through next week provided further support, though the hot weather was not seen as significant enough to boost demand in the long-term. Despite the technical bounce, natural gas traders expect the near-term downtrend in prices to continue, with some market participants expecting prices to fall to $1.850 in the short-term and eventually testing the all-time low of $1.020 hit in 1992. Meanwhile, researchers at Colorado State University said in a report that only four hurricanes are expected during this year’s storm season, further dampening sentiment on the fuel. In total, the storm season that runs from June 1 to Nov 30 will produce 10 named systems, compared with 19 last year. Energy traders track tropical weather in the event it disrupts production in the Gulf of Mexico. Production in federal waters in the Gulf accounts for about 10% of natural-gas output, and prices typically spike when storms threaten production. For today's session market is looking to take support at 101.2, a break below could see a test of 99.4 and where as resistance is now likely to be seen at 104.2, a move above could see prices testing 105.4.

Trading Ideas:

Nat.Gas trading range for the day is 99.4-105.4.

Natural gas recovered footing on bottom fishing speculation and short covering seen

Forecasts of warmer than normal weather across the US through next week provided further support.

Energy traders track tropical weather in the event it disrupts production in the Gulf of Mexico.