(Adds cash prices, analyst quote)
NEW YORK, Dec 13 (Reuters) - U.S. natural gas futures eased early Friday on light profit-taking and fluctuating weather forecasts after coming close to a two-year high on Thursday.
"The market is in overbought territory and becoming more susceptible to a round of profit taking selling at any time," said Energy Management Institute partner Dominick Chirichella. "As the severe cold temperatures ease a bit, we could see today's light round of selling get a tad deeper and last a bit longer."
At 9:50 a.m. EST (1450 GMT), front-month January futures on the New York Mercantile Exchange were down 3.4 cents at $4.375 per million British thermal units.
On Thursday, gas reached $4.434, its highest since May and a penny shy of a nearly 2-1/2-year high set in July 2011.
In the cash market, gas through Monday delivery at the NYMEX benchmark, Henry Hub <GT-HH-IDX> in Louisiana, was heard down 5 cents at $4.35. Early deals were about 2 cents under the front-month contract, easing from a 3-cent premium late Thursday.
Gas on the Transco pipeline at the New York citygate <E-TSCO6NY-IDX> was heard early up 7 cents at $6.79.
Some technical traders said a pullback might be in the offing. Prices have spiked more than 25 percent in the six weeks since Nov. 1, they said, and the 14-day relative strength index, an underlying indicator of market momentum, has climbed into very overbought territory.
The U.S. National Weather Service in its six-to-10-day outlook on Thursday forecast below-normal temperatures in the northern part of the country centered on the Upper Midwest and above-normal readings in the southern area of the country from California to New Jersey.
The NWS's eight- to 14-day outlook predicted the coldest weather would still be in the Upper Midwest, with below-normal temperatures reaching from Washington state down to northern Texas and up to New York and New England, while the Desert Southwest and much of the Southeast would experience above-normal weather.
The U.S. Energy Information Administration reported on Thursday that total gas inventories fell last week by 81 billion cubic feet to 3.533 trillion cubic feet, well above last year's draw of 8 bcf and exceeding the five-year average of 76 bcf for that week.
The weekly draw widened the storage deficit relative to last year to 273 bcf, or 7.2 percent. It also increased the shortfall to 3 percent versus the five-year average.
In U.S. nuclear news, about 6,900 megawatts of capacity were out on Friday versus 7,100 MW out on Thursday. That compares with 12,200 MW out last year and a five-year average of 8,200 MW. (Reporting by Scott DiSavino and Eileen Houlihan; Editing by Steve Orlofsky and Lisa Von Ahn)