This is a bit different. The last three expirations saw flat trading with a pop on the contango as the next month became the front month.
Not sure exactly what it means but any change in behavior is worth paying very close attention to.
From Reuters:
U.S. natural gas futures end up, Oct set to expire Wed
U.S. natural gas futures ended 3 percent higher on Tuesday, underpinned by short covering ahead of the October contract expiration on Wednesday, but high supplies, mild weather forecasts and slowing demand continued to limit the upside.
Many traders said they expect buyers to remain cautious until cooler temperatures arrive to stir more heating load, particularly with storage and production still running at or near record highs.
"We have options expiring today and futures tomorrow, so there has been some book squaring, but I think we need to see a sustained period of cold before we get a significant rally," a Pennsylvania-based trader said.
Front-month October gas futures on the New York Mercantile Exchange, which expire on Wednesday, ended up 8.7 cents, or 3.1 percent, at $2.924 per million British thermal units after trading between $2.843 and $2.943.
Strong buying, focused mainly in the nearby contract, narrowed spreads to winter months after Monday's 10-week high, with the January premium to October slipping 3.3 cents to 61.4 cents. That spread is still up about 34 percent since closing at a 14-month low of 45.8 cents just two weeks ago.
Despite Tuesday's gains, technical traders agree the market seemed trapped in a range between $2.70 and $3, waiting for a reason to break out.
Nuclear plant outages are running 6,200 megawatts above year-ago and may be giving gas demand from electric utilities a boost - gas-fired units usually replace any lost generation - but traders noted the impact was limited by milder temperatures that have slowed overall power loads....MORE
