8/17/19

 

Nat-Gas To Test Lows?

 

Nat-gas showed signs of demand the past week but it may not be over for the downside.

 

The chart of UNG shows a channel breakout attempt that has failed … thus far.

 

Since the market seems to be using the weekly EIA report each Thursday as an excuse to move prices, we’ll use that as a timing mechanism.

 

So, we’re looking for a test low (if nat-gas moves lower from here) somewhere around this coming Thursday or Thursday, next.

 

The clock is ticking.  Summer temperatures while moderate and not supporting demand at this point, may be forecasting a brutal winter to come.


8/15/19

Mid-session, 1:20 p.m. EST

 

Nat-Gas Negates New Lows

 

Nat-gas broke to the up-side through resistance.  It’s mid session with UGAZ currently at 14.20.

 

With such a well defined S-R boundary, one can expect some kind of test (of the 13.00 –area) in the coming sessions.


8/14/19

Nat-Gas To New Lows

 

Natural gas price action (UGAZ) points to possible new yearly lows.

 

Pre-market activity had nat-gas higher.  At the market open, that lead had eroded.

 

We’ve exited our long position based on this data and are now on the sidelines.


8/10/19  

Run Silent Run Deep

 

The Friday, August 9th, edition of the Wall St. Journal has a half-page article about how ‘climate change’ is going to forever alter our eating habits. 

 

It’s yet another global warming propaganda piece that is miss-directing the unaware and easily swayed public to think the earth is heating up.

 

Of course, the exact opposite is true.  Here’s one more link to a report that supports yesterday’s report that supports the report from the day before.  We’re cooling down … fast.

Meanwhile, far from all the babble is natural gas … Run Silent Run Deep 

 

Nat-gas is at the danger point and under the radar.  It may be in the process of forming a reversal that leads to its first sustained up-trend of the season … heading into fall and winter.

 

Of course, the very next session could completely negate the attached chart analysis.  That’s the way of the markets.

 

However, if we get continued pressure higher and potentially breach the resistance area, the initial trend (22,000%, annualized for UGAZ) would be aggressive, indeed.

 

It’s hardly noticeable.  If we’re at a pivot, only later will this point in time have clarity.


 8/8/19:  Nat-gas, Bearish Consensus?

 

Here's a brief video with bearish stance on nat-gas

 

Paraphrased comments below: 

  • Nat-gas is in a negative market … and has been for ages
  • No scenario where rallies can be taken seriously
  • Higher levels offer opportunities to short this market
  • We’re going to test lower at $2.00, support

The annotated chart shows current situation as of today’s close.  It’s true that we’re at the underside of a major boundary.

 

However, the price action from mid-June to now, can be seen as penetration of longtime support and then congesting at that low.

 

We’ve already had a minor spring higher in today’s session.  Now we’re at the larger resistance boundary.

 

Different this time, are fundamental factors not the least of which is the possibility for a record breaking cold winter.

 

Summer has already been mild which helped to draw prices lower.  It seems the quiet summer has put all but the attentive few to sleep as well.

 

As David Wies said (when trading springs), if prices move lower, we’ll be stopped out … “so what?” 

 

Taking a significant position at the danger point in his words, are for those “who have the nerve.”

 

We’ll see.


8/8/19 (9:15 a.m. EST)

 

Natural gas report release, 10:00 a.m. EST

 

Hourly candle chart of UGAZ shows nascent trend reversal.  Yesterday’s session may have been a test of the multi-year lows … setting up a spring condition.

 

Pre-market activity shows UGAZ trading slightly higher.


8/3/19:  Nat-Gas Penetrates Lower, Then A Reversal 

 

Natural gas has a vicious push below support and then pivots upward.

 

The ‘gut-check’ discussed in the 7/31/19, update (below) is upon us.  What happens next may define the true intentions of the natural gas market.

 

The fundamental background remains the same.  It’s even in our faces on a near daily basis. 

 

It’s unusually cold in England and crops are in trouble.  Right here in Ft. Worth, it did not reach a 100-degree high until late July; something that has not happened since 1989.

 

Cooler temps in the middle of summer.  What’s going to happen this winter?


7/31/19:  Natural gas shows strategic potential

 

Yesterday, a spring set-up was identified.  Today, there’s confirmation.

 

Next, we watch for the “proverbial gut-check”.

 

As explained in the Weis video, at times a spring in progress will have a one or two day adverse move; a gut check, to see if you can hang on.

 

Depending on how or if that move transpires, we’ll look to add to our position that was established last session around 2:00 p.m. EST. 

 

The timing appears to be in synch as it’s getting to be mid-summer.  Sometime in the near future, the market’s focus is going to shift to the fall and winter months.

 

It’s important to establish a strategic, low risk position early as commodities tend to have blow-off tops that are especially violent.  It’s best to watch and be in such moves early and well in the green so that one can think (and exit) objectively.


7/30/19:  Spring Position, Play It Again

 

The June update had natural gas in spring position.  Indeed, there was upward price action following that report.  However, it stalled, returned lower, penetrating support during the past two sessions.

 

That puts us in spring position again.

 

The press (link here) is attributing the lower moves to cooler weather that has natural gas prices dropping to a 3-year low.

 

Price action seems to be very short sighted.  Cool weather in the middle of summer?  What temperatures are coming this winter?

 

Anecdotally, as I went outside early morning a few days ago here in North Central Texas (just west of Ft. Worth), it was COLD.  Not cool or mild, but cold. 

 

This link shows July 25th low, at 65-degrees in the city!

 

These data points are connecting the dots for a potential disastrous (if not already) crop harvest and then bitter, potentially record-breaking cold into the winter months.


6/30/19  Natural Gas (UNG)

 

With natural gas (UNG) penetrating support and failing to move lower, we’re now in spring position.

 

Because the sector has pushed below levels not seen since June of 2016 (futures market), there’s a potential for a significant, strategic reversal.

 

Note the gap between the 6/21/19, weekly close and the following 6/28/19, weekly low.  Supply (downward pressure) may be exhausted.

 

High volume bullish ETFs for this sector are (but not limited to):  UNG (1X) and UGAZ (3X).

 

Charts by StockCharts