The natural gas rout continued today with the March contract settling down over 4.5% below yesterday's settle as weather forecasts continued trending warmer and EIA data did little to arouse bulls. 

As one would expect in this weather-driven decline, the March contract was again isolated in how much it fell, with losses all along the natural gas strip. 

After an EIA print that generally came in line with expectations, prices declined further and bounced off the $2.85 level we warned clients about in our Morning Text Message Alert early this morning. 

Prices then following the outline in our Morning Update perfectly, declining to $2.85 after the EIA print but then bouncing off that level into and after the settle on a slightly colder run of European guidance. 

This came as EIA data came just 2 bcf away from our estimate, confirming our market outlook. 

The EIA announced that last week we withdrew 99 bcf of gas from storage, which was a smaller draw than the 5-year average but around what we saw last year. However, for a market whose primary focus is limited storage levels, a smaller-than-average withdrawal that hits expectations is not going to get bulls excited. 

The print combined with warmer overnight weather pulled H/J back down to levels that have not been seen since December. 

We were tracking this intraday spread closely, and in our Note of the Day sent to clients just past 11 AM Eastern we pointed to limited downside below the $2.85 level as we saw the natural gas strip as a bit more supportive. 

Sure enough, despite a number of tests and few movements just below that level, prices did not move another leg lower through the day. Attention now shifts to the weekend, where traders will have to decide whether prices have sold off enough that they should position in case models trend colder over the weekend, or whether the risk for warmer trends may be enough to send prices even lower.