U. S. crude futures edged higher towards $57 a barrel on Friday, extending a 5.3 percent rise made over the past two days on growing signs that global economic pain may be moderating.

New York Mercantile Exchange natural gas futures ended up sharply Thursday despite a bearish weekly inventory report, as steady technical buying after key breaks of resistance overwhelmed concerns about supplies.

Crude on Thursday closed at a near six-month high of $56.71 a barrel, the highest settle mentsince Nov. 14, after hitting a peak of $58.57 earlier.

U. S. Labor Department data on Thursday showed the number of U. S. workers filing new claims for jobless aid unexpectedly fell by
34,000 last week.

June natural gas rallied 19.4 cents, or 5 percent, to close at $4.081 per mmBtu after sinking to $3.82 shortly after the EIA storage report, then climbing midday to a six-week spot high of $4.132. Just prior to release of weekly stock data at 10:30 a. m., the front month was trading at $3.94.

The number of U. S. rigs drilling for natural gas has slid to its lowest level in more than six years as low prices and tight credit force producers to slow development. Gross natural gas production in February was still running at about 4 percent above year-ago levels, according to EIA, but analysts said as total gas rigs fall below 700, year-on-year output should start to turn negative.

We believe the rally we saw in crude oil may take a breather and prices may edge down and test $55.50 per barrel.

Natural Gas has been the outperformer in the energy complex in the last two days. We recommend buying natural gas at a decline rather than going short.

Crude oil technically looks strong we recommend buying crude oil at dips. A support is seen at $55 per barrel and an upside resistance is seen at $58.50.

For Natural Gas, above $4.20 we recommend entering into fresh long positions. RSI and other directional indicators are pointing towards bullishness in prices.