It was another slower trading day for natural gas today, with the February contract settling down around half a percent as traders weighed a dip in production against weather forecasts that still showed very few cold risks. 

Losses were about equal at the front of the strip, with the front few contracts generally moving in tandem after the February contract was initially the weakest early this morning. 

Our Morning Update highlighted a Neutral sentiment again today but said that our $2.92 support level was "at risk" of being temporarily broken today as overnight forecasts did not trend much more impressive. This happened through the morning on cash weakness, but only briefly. 

Yet we also saw early signs that afternoon model guidance could trend more favorable for cold weather in the long-range for the first time, with our 12z expectations in our Morning Update finally ticking slightly bullish. 

Sure enough, afternoon GEFS weather model guidance ticked a bit colder in the long-range, helping provide some support at the front of the natural gas strip (images courtesy of Tropical Tidbits). 

Of course, this colder weather comes after a period of significant warmth, limiting any potential bullish impact. 

Meanwhile, traders are closely watching tomorrow's EIA print for evidence of just how much balances loosened over the Christmas holiday. While there was a slight tick higher in GWDDs week-over-week, the Christmas holiday destroyed quite a bit of demand and traders are expecting a decently smaller withdrawal. 

Our Afternoon Update ran through our expectations for the EIA print out tomorrow, and we will release our EIA Rapid Release and Note of the Day immediately after the number tomorrow putting it into context. It will be a matter of how loose, not if it is loose, meaning we'll be closely looking at the front of the gas strip to see just how much loosening it seems traders have already priced in.