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Natural Gas: Back-To-Back Selling Opportunities

Published 08/14/2022, 07:36 AM
Updated 07/09/2023, 06:32 AM

Natural gas futures on the Nymex had a positive week before closing 9% higher than the previous one at $8,78. EIA reported on Thursday a build of 44 Bcf in working underground stocks for the week ended August 5. Inventory is currently at 2,501 Bcf, 9,7% lower yoy, 11.9% below the 5-year average. Both percentages have been steadily on the decline.

We have been selling rallies on exhaustion on the near term charts on directional trading for the past couple of months. We have already taken 40% on real time trading and we are considering this last move as another gift for us really. We only have to wait for the next Daily MACD crossing. Ridiculously high pricing has been making our job and hedging way too easy lately on our way to $3.70 for the April 2023 contract.

I have talked many times about the future American LNG exports and the crucial gas-fired electricity generation market share. Allow me a little bit of macro about our planet and fossil fuels. Too many producers have been hijacked lately. They are held hostage by large trading offices and banks. By people who have little interest in the domestic market or consumers. They are profiteering on the occasion of the war. They also fund Putin himself. I am talking about Oil and Gas altogether. The behavior of many of them brought exactly this result: Natural gas, the last fuel to be burned on Earth, is now even losing its status of a bridge fuel. Western democracies are not going to be held hostage, either we'll sell at a good price or they'll get it for free in no time. If anything is to be subsidized by governments and taxpayers, it will not be fossil fuels at current prices.

Many major oil and gas companies are starting renewables and they are to be congratulated even belatedly. The transition will take place, due to climate change but also due to the development of technology. It is not possible for only two industries, fossil fuels and shipping to create such a big mess in the global economy and inflation for such a long time on their profit. The energy transition will run even faster for everyone because of behaviors like these. Be careful where you invest in. U.S. macro data and the Dollar Index to be monitored routinely. Daily, 4hour, 15min MACD and RSI are pointing to entry areas.
Nat Gas 4H-Chart

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