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The natural gas markets attempted to rally during the session on Thursday, but fell as the build came in at 21 BCF. While this is much less than usual, the fact that there was still a sizable amount injected into storage during the same week that tropical storms and hurricanes in the Gulf of Mexico shows that there is simply far too much gas out there to be depleted by demand.
It's obvious to us that the $2.90 level is becoming more and more resistive, and the fact that we formed a shooting star suggests to us that we are going to fall from here. On a break of the lows from Thursday session, we are shorting and more than willing to hang on until we hit $2.40. We do recognize $2.60 as potential support though, and would be a bit careful if we stall in this area. As for buying, it's not even a thought.