GAZB - Natural Gas: Fundamentally Overvalued And Technically Overbought

• Currently, I expect the EIA to report a build of 73 bcf next week (a final estimate will be released on Wednesday).
• If the latest weather forecast remains unchanged, total natural gas demand will increase by 9.9 bcf/d y-o-y (on average) over the next two weeks.
• Storage deficit vs. five-year average is projected to expand by 97 bcf by July 16 (from -69 bcf to -166 bcf).
• The two most bullish factors are not going away: the bullish weather forecast and relatively high nuclear outages.
• I do not feel comfortable buying above $3.100 per MMBtu – especially, at a time when so much depends on the whims of the weather and fuel-switching economics favor coal over natural gas.

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