* Prices remain above Wednesday low * Long-term outlooks call for milder weather * Coming up: EIA natgas storage data Friday By Eileen Houlihan NEW YORK, Jan 3 (Reuters) - U.S. natural gas futures slid about 1 percent on Thursday, extending losses for a third straight trading day due to moderating weather forecasts. But prices remained above Wednesday's three-month spot chart low. A huge 30-cent, or 9 percent, drop in prices on Wednesday was blamed on algorithmic, or computer-driven, trading. Still, prices have continued to struggle this week amid the milder weather outlook, which should curb heating needs and lessen demand for gas. "The weather continues to have a negative impact on natural gas prices, with the eastern half of the U.S. projected to experience above-normal temperatures at least through the first half of January and possibly beyond," said Energy Management Institute's Dominick Chirichella. Front-month February natural gas futures on the New York Mercantile Exchange slid 3.5 cents, or a little more than 1 percent, to settle at $3.198 per million British thermal units, after trading between $3.164 and $3.236. Other months ended lower as well, with the March contract losing 4.1 cents, also a little over 1 percent, to end at $3.214, and summer months losing about 4 cents each. The front-month contract fell as low as $3.05 on Wednesday, a contract low and the lowest mark for a spot contract since late September. On the technical charts, prices remained below the 14-day moving average near $3.36 and the 40-day moving average near $3.55, but above the 200-day moving average near $2.91. In the cash market, gas for Friday delivery at the NYMEX benchmark Henry Hub in Louisiana lost 11 cents to average $3.19. Late deals were done at 3 cents under the front-month contract, easing from deals done late Wednesday at a 4-cent premium. Gas on the Transco pipeline at the New York citygate slid nearly $4 to average about $6. The latest National Weather Service six-to-10-day forecast, issued on Wednesday, called for above-normal temperatures for a little more than the eastern half of the United States, with below-normal readings only in the West. Private forecasters agreed with the milder outlook, with MDA Weather Services' six-to-10-day outlook showing much-above-normal temperatures across the eastern half of the nation and normal readings in the West. Nuclear outages totaled just 7,500 megawatts, or 7 percent of U.S. capacity, down slightly from 8,500 MW out on Wednesday but up from 7,200 MW out a year ago and a five-year average outage rate of about 5,500 MW. WINTER STORAGE STILL BLOATED Last week's Energy Information Agency (EIA) gas storage report showed total domestic inventories fell 72 billion cubic feet to 3.652 trillion cubic feet, below market expectations for a 76 bcf draw. Inventories started the heating season in early November at an all-time high of 3.929 tcf and are still at record highs for this time of year, hovering at more than 2 percent above last year and 13 percent above the five-year average. Withdrawal estimates for this week's report ranged widely, from 68 bcf to 165 bcf, with most traders and analysts expecting a draw of about 127 bcf when data is reported early Friday, a Reuters poll showed. Stocks fell 77 bcf during the same week a year ago and have dropped about 111 bcf on average in that week over the past five years. The EIA report is delayed by one day this week, until Friday, because of the New Year's Day holiday on Tuesday. RIGS GAIN, OUTPUT STILL NEAR RECORD Baker Hughes data last week showed the gas-directed rig count rose by two to 431, its second straight weekly gain. But drilling for natural gas has mostly declined for more than a year, with gas rigs down 54 percent since peaking at 936 in October 2011. The gas rig count is hovering just above a 13-1/2-year low of 413 hit seven weeks ago, but so far production has not shown any significant sign of slowing. The EIA expects gas output in 2013 to rise to a record high of 69.59 bcf per day, the third straight annual record.