early open sunday for nymex energy

Many thanks to NYMEX for this retarded (albeit opportunity laden) pre-open, lets call it arbapalooza!

PS - What changed since Friday? How many times are we going to mark up CL $3 on a storm that's in line with predictions from a week ago? Did someone actually expect it to disintegrate over Cuba and go away? Smells like a hot potato to me.
 
Bro, I'm not debating what the price of NG SHOULD be...I agree with you that it is significantly undervalued...

But you can't ignore the market action, which was decidely weak, with a storm heading into the Gulf EXACTLY as the traders had bet - Cat 4 heading into the Gulf...If we get any sign of slowdown in this storm, we could shit the bed. Odds don't suggest that, and yet the market still falls and closes near the lows of the day/week/month.

Someone could very well be caught seriously long and is puking a la amaranth style trade. We just don't know who it is yet. We might never know.

COT reports for energies are the only ones that I don't follow because I think they are useless since the Enron Loophole skews who is a Comm and who is a Spec.

we are probably nearing some kind of bottom in NG, and hence the major volatility...probably one more capitulation and then we take off...I am long outright calls in X and G, playing with minis and delta writes...

Again, you can't say this price action is anything but neutral/bearish. In my opinion of course...

If any market can turn tail and run in a hurry, it's this one.

Quote from scriabinop23:

???? Have you seen the CFTC COT? Specs are net 200K+ contracts short.
Just this week a net 28k+ new short contracts (ending the 26th).
Top 4 traders are holding 26.4% of the short open interest (1.2M contracts) after factoring in spreading ... That is about 317K net short contracts amongst 4 hedge fund players.



The price action you saw is called desperate position defense in an a demand inelastic and temporarily well supplied market.

One hit of similar magnitude to last horrible hurricanes could trim 900-1000bcf off of net production for the next 6-12 months. Combine that with a cold winter and natty could just as easily go to $20-30/mcf. [if you don't believe me, take a look a transco-z6 in NY prices in winter]

$20/mcf = 6:1 energy content ratio to $120 crude. As well, up until recently asian importers have been paying almost that for LNG.
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Quote from Pachoo:

Interesting. I wonder how much crude and natural gas are going to spike up tomorrow.
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Hurricane only seems to be at Cat-2 ( 105MPH ) strength right now and is showing some weakening aspects. The storm however is moving along faster than initially projected.

Should be running into a cold eddy in the Gulf later tonight which could slow it further, albeit temporarily. Wind shear is currently running at a moderate range of 10-15 knots.
A tear in the eye-wall has been noticed, which is a weakening sign.

http://www.wunderground.com/blog/JeffMasters/show.html

Probably gonna be no greater than a Cat-3 when it hits the Louisiana coast.
 
Quote from PohPoh:

Bro, I'm not debating what the price of NG SHOULD be...I agree with you that it is significantly undervalued...

But you can't ignore the market action, which was decidely weak, with a storm heading into the Gulf EXACTLY as the traders had bet - Cat 4 heading into the Gulf...If we get any sign of slowdown in this storm, we could shit the bed. Odds don't suggest that, and yet the market still falls and closes near the lows of the day/week/month.

Someone could very well be caught seriously long and is puking a la amaranth style trade. We just don't know who it is yet. We might never know.

COT reports for energies are the only ones that I don't follow because I think they are useless since the Enron Loophole skews who is a Comm and who is a Spec.

we are probably nearing some kind of bottom in NG, and hence the major volatility...probably one more capitulation and then we take off...I am long outright calls in X and G, playing with minis and delta writes...

Again, you can't say this price action is anything but neutral/bearish. In my opinion of course...

If any market can turn tail and run in a hurry, it's this one.
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I couldnt have said it any better PohPoh. It all becomes clear when you really think about it. Do you trade outright futures as well? I seem some big bids coming across now
 
Quote from Rtrader2525:

YA Im pretty sure the ex Amar. guys run Centaurus now. I think they got some of Motherrock as well. Regardless I'd rather be with them than against them. I would be alot more nervous as a short here, I could be wrong. I have been many times before, and if I am I will simply bail out of the trade. I just feel alot more comfortable long than short here. NG sell off was pretty overdone imo, and liek a friend of mine said "A strong fart in the gulf could really send this thing up" Anyways showtime in an hour
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Centaurus guys are ex-Enron, I think, though I don't care enough to research my disinformation...

But Centaurus was on the opposite side of Brian Hunter in the Amaranth debcale...

(again, could be wrong, don't want to check)
 
Quote from Rtrader2525:

I couldnt have said it any better PohPoh. It all becomes clear when you really think about it. Do you trade outright futures as well? I seem some big bids coming across now
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I trade a little bit of everything...
soft spots for crazy markets like NG...

Take a look at the NG action after Ivan in 2004 (large selloff on landfall, and then it rallied for 2 years.)
We might see something similar to that...

Firms with very large pockets can buy at 8, 7, 6, 5, 4 and not break a sweat. These markets are not too big that they can't be manipulated by those with enough cash.
 
Ya I trade NG frequently and it is a great market to trade. Regardless of what happens now I think NG remains a buy at these levels, I have been buying dips and have done fairly well with it the last few weeks. Just in and out and in and out. I really might try and build a position out of this though, it looks to be a very cold harsh winter coming up. (source farmers almanac) Do you have a postion now?
 
Quote from Rtrader2525:

Ya I trade NG frequently and it is a great market to trade. Regardless of what happens now I think NG remains a buy at these levels, I have been buying dips and have done fairly well with it the last few weeks. Just in and out and in and out. I really might try and build a position out of this though, it looks to be a very cold harsh winter coming up. (source farmers almanac) Do you have a postion now?
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You're buying based upon the Farmer's Almanac? HTF has SAC missed picking you up?
 
according to weather underground. The storm is now intensifying again. This thing is extremely unpredictable. Poor people in the gulf. Fucked Cuba up pretty bad as well :(
 
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