Long

Updated

Natural Gas --- ( 2 0 2 1 ) Swing Trade

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The Natural Gas setup for 2021 is not only fundamentally bullish, it's a technical trader's gassy dream.
Welcome to the G a s i n o.

Macro View
From a macro view we can see that prices are now at the bottom of a historically supportive range. The previous deviations that dipped below this range were due to the bearish sentiment as production was trending up. This is no longer the case. Sentiment has now flipped cautiously bullish as supply/demand balance is expected to remain tight.

Bullish Indicators
First, we can see the weekly MACD is decisively bullish and above the zero line. This confirms momentum is going to likely remain bullish longer term.
Secondly, looking at the Commitment of Traders (COT) report on the indicator below the MACD, we see that Asset Managers and Speculators are more interested in long positions than usual. Should be plenty more next year.
Thirdly, prices are maintaining above the 50 week EMA.

Not to mention the inverse head and shoulders that is under construction. You heard it here first.

The Trade Setup
Now, if we overlay two important contracts for Summer(orange) and Winter(blue), we can start extrapolating potential targets. Current prices for either one are at the bottom of the range. This is what large speculators are looking at. This is where I am going to start accumulating starting with Summer. In addition, I am also buying dips of EQT as producers will benefit from stronger prices over the next couple years.

Looking at the August 2021 contract, prices have broken out of the down trend.
Today, in anticipation of a large swing trade next year, I opened a starting long position on the mini contract (QGQ2021) @ $2.78
I welcome dips and estimate a sell target somewhere well north of $3.00
TBD

Trading is risky, don't do it.

Long EQT and
QGQ2021 +1 @ 2.78

Note

Been taking profits on EQT, trimming over the last week for a roughly 40% gain. Down to 1/3 position size.

Note

Trimmed EQT down to 1/4 position size today. Will accumulate more on dips to prepare for a rally in the latter half of the year.

Note

As we approach Spring contracts and typically warmer temperatures, NG prices tends to weaken. However, that is the time to accumulate on dips as 2021 is set for a deficit for the first time in a while. As Summer approaches, prices should start flattening out, grinding higher, then exploding in typical NG fashion.

Note

EQT (NG producer) is pulling back after a 40% rally. I'm looking to reload this position and am waiting for a deeper correction towards $15 or so. Later this year I wouldn't be surprised for it to tag $20, possibly more.

Note

EQT dipped hard today so I'm buying a little here. Accumulating bits and pieces on any dips like this moving forward. Should start to see buyers coming in as it approaches the trendline.

Note

Nibbling more EQT here at $16.46

Note

Selling most of my EQT into this rally.

Note

Buying back more EQT @ 16.30

Trade closed manually

Sold August @ 3.07 for $700something gain. Shooting star/inverted hammer formed on the weekly and don't see much more room to run in the short term so I'll look to re-enter lower.

Note

Lazy swing trading is the way to go. Placing a GTC buy limit order on August(Q) @ 2.you guessed it,66 .......

Note

Swing trade update. The 'volume profile' indicator shows that 2.8 is where heavy volume came in previously and it will likely be strong support on the August contract. At some point price should start to run sideways in anticipation for stronger cooling demand in the summer so I'll will start buying again at 2.8 if the setup looks good.

Note

Once price can crack through that volume barrier and find support above $3.00 in the summer, winter prices should get interesting if the supply shock comes into focus.

Note

Still waiting on the long opportunity in Summer contracts. It's a good rule to wait until the trend is broken (with conviction). Until then, not interested. Price can easily fall through the floor as production ramps up. Waiting for price to find its way to the other side of this down trend.

Note

Price cratered right on que. Next, need to see how price responds to this historically supportive level. If I see a long wick at the bottom of a daily candle, like the ones shown at previous bottoms, it might be time to buy. But will remain cautious until that trend line is broken.

Note

Took off quicker than expected so shorting June contract and waiting for a pullback to buy August or might even just buy December.

trade-God

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trade-God