UNG
UNG at supportUNG at long term support should hold easily , can be a trade with 20% upside. next stop UNG 18.7
Second go at the winter Nat Gaz pop!We have had a very warm winter so far. January / February forecast call for much cooler weather after the first week of January. This gives you enough time to position yourself for that pop. Personally, I am March using BOIL calls wih 9$ strike price for this trade.
Disclaimer: The above are just my opinions and should not be construed as trading advises.
THE WEEK AHEAD: ULTA EARNINGS; APA, UNG, VIXEARNINGS:
Earnings are light in the coming week, with ULTA (90/47) being the best candidate metrically for a earnings-related volatility contraction play, although its liquidity isn't great.
Pictured here is a 205/210/265/270 iron condor in the January cycle that is paying 2.06 at the mid (1.03 at 50% max). Markets, however, are showing wide here.
SINGLE NAME WITH EARNINGS IN THE REAR VIEW:
APA (100/71)
CGC (75/89)
NTNX (66/43)
X (52/27)
See APA, CGC posts below.
EXCHANGE-TRADED FUNDS:
UNG (51/54)
USO (37/37)
TLT (34/12)
XLE (26/19)
FXI (23/20)
XOP (23/34)
First expiries in which at-the-money short straddle pays >10% of the value of the underlying:
UNG: January, 2.84 versus 17.83 (15.9%)
USO: April, 1.84 versus 11.62 (15.8%)
TLT: January of '21, 14.78 versus 140.42 (10.5%)
XLE: June, 7.20 versus 58.89 (12.2%)
FXI: May, 4.18 versus 40.94 (10.2%)
XOP: January, 2.06 versus 20.36 (10.1%)
Already up to my nipples in oil and gas plays, so may consider a small FXI position. Naturally, May is a bit farther out in time than I'd like -- the 36/46 short strangle camped out around the 16 delta is paying 1.06 there.
BROAD MARKET:
QQQ (4/15)
IWM (4/15)
SPY (4/12)
First expiries in which at-the-money short straddle pays >10% of the value of the underlying:
QQQ: June, 21.71 versus 205.10 (10.6%)
IWM: June, 16.34 versus 161.77 (10.1%)
SPY: Sept, 34.63 versus 314.31 (11.0%)
QQQ June 181/226 20 delta short strangle, 6.48 credit (1.62 at 25% max; 3.24 at 50% max)
IWM June 143/180 20 delta put/16 delta call* short strangle, 4.33 credit (1.08 at 25% max; 2.17 at 50% max)
SPY September 274/345 20 delta short strangle, 10.70 credit (2.68 at 25% max; 5.35 at 50% max).
* -- Strikes on the call side are 5-wide at the moment, with the 180 at the 16, the 175 at the 25.
FUTURES:
/6B (63/14)
/NG (51/90)
/ZF (39/3)
/CL (37/39)
/ZN (37/4)
OVX popped big on Friday, so I will look to add short premium setups in /CL if that nearly 37 print hangs in there over the next couple of sessions.
VIX/VIX DERIVATIVES:
With /VX futures contracts trading at 16.39, 17.65, and 17.86 in January, February, and March, respectively. VIX term structure trades remain viable for those expiries. For everything else, wait for a pop in VIX -- which finished Friday's session at 12.62 ... .
UNG (natural gas ETF) 16% up 24% down... My intention was to analyze the NG exchange rate. Even so, I still chose his ETF. The fractal motion is much more visible in this. That is why I would like to present this. It is clear from the movement of the exchange rate that Friday's big fall (7%) was an expected process. The figure clearly shows that a fractal sequence has been completed. It is also clear that the original fractal is copied in a 2: 1 ratio. This copy has been slow for a month now. Therefore, I assume that further movement follows similar regularity. This means that NG and its ETF will turn north in the coming days. The ETF may increase by 16%. But from that level, another decline may begin. Nearly 24%. I am expecting the bottom of the ETF to be 15.44 usd. Then the most interesting thing happens. I assume that NG can start an amazing rise after 14 years. I also recommend this for a longer term investment.
Elliot triangle waveBroadening bottom.
Still in awkward position but I'm bull biased based on harmonic patterns.
Commercials are heavy long NGI was wrong on my last idea, NG went on and dropped lower. Trend remains down until we see a close above 2.33 then 2.48. Commercials are heavy long at levels not seen since 2016. Seasonality is bullish from now to Nov-Dec. we just need to see a sustainable rally to bolster the idea of a bottom for the year.
**If you're interested in joining a group of like-minded traders, send me a PM. This is NOT a subscription service, just bunch of average traders sharing insights in a FREE group
Winter weather strongly influences on NATGAS demandNATGASUSD on the chart is showing 5-0 patten completed, ABCD on the way. Keep watching UGAZ!!
$NG1! Showing A Similar Trading Pattern As Last Year$NG1! prices have been depressed for so long, that the only play this year has been short.
As we look ahead to the upcoming winter season, we usually get a strong rally as traders buy the rumor or fear of a harsh winter. Once reality sets in and winter arrives, prices usually sell off.
There's an opportunity for traders to get in and play the fall rally.
Traders need to keep an eye on the 200 day moving average of 2.760 in front month nat gas contracts. Above there, and we have a trend change and algo funds will pile in.
It's important to monitor weekly inventory reports every Thursday. Another way to play is with small producers like our recommendation in $CRK.
As always, use protective stops and trade with caution.
Good luck to all!
The power of An Ascending Triangle with NG1!The pattern is completed on a decisive breakthrough the upper flat line of the Ascending triangle.
#ung #ugaz
A Natural Gas IdeaI still don't think that NG bottoms until the end of December. Just basing it off the cycles analysis idea I have going...but NG is tricky. This is what I think may be going on right now on a short term cycle. If this count is correct, then the wave 1 is longer than the wave 3 which of course would mean that wave 5 must be smaller than 3. Soooo, I extended the fib measurement of wave 3 down (assuming we ended this little up move, and what do you know, it fits. Lets see. I do not have a position yet but if NG drops to that blue box then a nice short term long position will suffice.
Natty accumulation - drop, then rock n roll$ung $ugaz $dgaz $boil $gaz $unl $kold Make no mistake- ol natty will be quite bullish but watch for another big flush drop into this descending formation - very likely another drop before the bull can break out. Short term could be bearish.. wait patiently I may consider some UNG puts until we can break out of this.
Natural Gas Daily About To Break Out Of Falling WedgeThe $NG daily has been doing battle with the 50dsma for 8 months. The falling wedge is about to explode to the upside.
Natural Gas Needs a Gap UpThe natural gas daily has been unsuccessfully trying to beat the 50dsma for 5 months now. A gap up may be needed to beat the 50 and the falling wedge.
NG no signs of strength yetNG seems to be working a bear flag, I'm still looking for a tradeable bottom, until then I'll be staying on the sidelines until market finds a bottom and show (SOS) sign of strength. 1.9 seems likely at this point, if thats the case NG needs to bottom this month as bullish seasonality starts early Sep
TRADE IDEA: UNG JAN 22/24 LONG CALL VERTICALMetrics:
Max Profit: $164/contract
Max Loss: $36 (assuming mid price fill)
Break Even: 22.36
Delta/Theta: 9.03/-.07
Notes: A seasonality play put on at /NG lows ... . UNG's not my favorite instrument in the world, nor is it the most liquid that far out in time. It's also possible that /NG could trundle lower, since seasonal peak injection generally doesn't occur until later in the year on average.
The pictured setup prices out at .18 bid/.36 mid/.53 ask and would pay well if we get another Polar Vortex. If we don't, we'll you aren't out much ... .
