If open interest decreases, then both existing shorts and existing longs are closing positions ... short covering AND profit taking.
Even assuming you're right, it doesn't follow that this move is, for some reason, unsustainable. It doesn't support your bear case whatsoever.
Doesn't open interest always significantly decline when delivery gets near? Nov contracts stop trading very soon, correct? Since very few futures contracts actually get delivered, it seems normal that the open interest would decline quite a bit through the end of the week.
I'm still at a loss (as I was last week)... Why is gas up again today? Any fundamental reasons like weather or pipeline explosions? Or was it suddenly time to recouple to oil? Looking at all NOAA forecasts and they have been milding down. NOAA forecasts Nov to be above average warmth this month. Even the daily and short term forecasts are becoming more benign. http://www.cpc.noaa.gov/ On the other hand, accuweather... http://wwwa.accuweather.com/news-top-headline.asp So has the nat gas market completely discounted NOAA and bought everything from accuweather?
No one I know really pays attention to NOAA's long-term forecasts. Also, I really don't think much of the oil/natgas relationship. The correlation is not really dependable.
Make your analysis, go with the flow, draw you lines in the sand, push the buttons and wait for you profit or loss to come in. Keep it simple and don't even bother with questions that can not be answered... thats what FED guys and over paid wall street analysts are for, not traders.
From CME site: "Last Trading Day Trading terminates at the close of business on the fourth business day prior to the contract month." what date it for QG NOV ? Thanks