July natural gas prices rallied a bit over 2% today as very bearish balances let up and weather forecasts remained quite supportive in the long-range.
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Weather clearly played a strong role in today's price action with the front of the strip leading the way higher.
In our Afternoon Update yesterday we outlined to clients why our sentiment had turned slightly bullish, as we saw prices moving back up towards the $2.97-$3 level.
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Our Morning Update also reiterated that bullish weather was likely to push prices back up towards resistance.
This came as overnight model guidance added additional cooling demand in the long-range, in line with our expectations.
Our intraday Note of the Day similarly identified that resistance would easily hold today, with prices unable to break above $2.969.
Afternoon model guidance remained quite hot as well, as though European guidance cooled a touch we saw American GEFS guidance trended even hotter, as seen below courtesy of the Penn State E-Wall.
The result was a small narrowing in N/Q after significant widening in the face of looser balances.
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