BOIL / KOLD - a leveraged natural gas oscillator
Updated
Here on a dialy chart I have plotted the ratio of BOIL share price to that of KOLD, its leveraged
inverse. They both react to and reflect natural gas prices which are currently rising. I have also
plotted the supply demand indicator from Luxalgo and a better RSI indicator. As can be seen
on the chart the ratio ascended from relative weakness last fall into a long head and shoulder
pattern and then descended into its present range. The RSI bottomed abot 5/4/23 and
increasing since then. I see the present pattern as similar to what occurred last fall.
My thesis is that I should buy BOIL now as its price ascends until the ratio hits the supply
zone above and then flip by selling and buying KOLD instead. I see this as essentially a natural
gas buy and sell oscillator. To have more frequent trades and higher overall profits,
I would need to decrease the timeframe for the analysis down to 1-3 hours and follow
the ratio trending accordingly. At present, I will continue to accumulate further long positions
in BOIL
inverse. They both react to and reflect natural gas prices which are currently rising. I have also
plotted the supply demand indicator from Luxalgo and a better RSI indicator. As can be seen
on the chart the ratio ascended from relative weakness last fall into a long head and shoulder
pattern and then descended into its present range. The RSI bottomed abot 5/4/23 and
increasing since then. I see the present pattern as similar to what occurred last fall.
My thesis is that I should buy BOIL now as its price ascends until the ratio hits the supply
zone above and then flip by selling and buying KOLD instead. I see this as essentially a natural
gas buy and sell oscillator. To have more frequent trades and higher overall profits,
I would need to decrease the timeframe for the analysis down to 1-3 hours and follow
the ratio trending accordingly. At present, I will continue to accumulate further long positions
in BOIL
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OVer the short term XNGUSD is decreasing in a pullback from the action of the week;I will watch for a pivot low on a 15 minute timeframe of BOIL next week for an entry to add to the position.
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In the meanwhile my call options on KOLD taken as a hedge for the short term as up 26% over the weekend.Trade active
Boil popped today glad to be in call options with 2DTE. Taking some profit but holding out for ten -bagger on the calls.Trade active
Idea update on natural gas prices linked here 
Note
The oscillator has more or less topped out It will be time to sell BOIL and buy KOLD.The oscillator is on a daily time from but I am reading on a 60 minute TF
tradingview.com/chart/DFkQVEdC/?symbol=AMEX:KOLD
shows KOLD at a low with momentum and BB oscillators signalling a buy. I will take a single KOLD option safety with an expiration of 7/21 and reassess ina couple of days.
Note
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If there is a reverse split for shares on BOIL on June 23rd, this exact idea will be rendered obsolete but the concept is intact and the chart of the ratio will needredrawing.
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No matter if the ratio of BOIL / KOLD is rising and the RSI is above 50, this is bullish for BOIL and KOLD is bearish
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