U.S. natgas futures hold slim gains ahead of EIA stocks data
NEW YORK, Feb 28 (Reuters) - U.S. natural gas futures held slim gains early Thursday, underpinned by light buying ahead of what should be a bullish weekly inventory report this morning though the milder change in extended weather forecasts helped limit the upside. Cold forecasts helped drive the front contract up nearly 10 percent over the last two weeks, with the market also garnering support from utilities switching from coal to cheaper gas to generate power and hefty nuclear plant outages that should translate into more gas burn. Gas-fired units are typically used to offset any shut nuclear generation if the weather is cold or hot enough to require replacement power. But the moderating trend in weather forecasts at midweek stirred concerns that late winter demand will slow and limit potential upside in prices, particularly with inventories still high and production flowing at or near a record peak. At 9:15 a.m. EST (1415 GMT), front-month gas futures on the New York Mercantile Exchange were up 0.6 cent at $3.44 per million British thermal units, after trading between $3.395 and $3.46. While the recent run up in prices broke some key moving average and trendline resistance points and turned the chart picture more supportive, technical traders said Wednesday's weak front-month close after climbing intraday to a five-week high of $3.554 cast doubt about further upside. Most chart watchers would need a close at least above this year's high of $3.645 to turn more positive on prices. MDA Weather Services, a private forecaster, noted that both the six-to-10-day and 11-to-15-day outlooks turned a bit warmer overnight though another shot of cold air was expected to hit the Midwest late in the period.