Natural Gas Stocks - Any?

[smilingsynic]

Quote from Sparohok:

Good trade.

Someone was asking about seasonality. Summer prices are always lower than winter because of storage costs. I'd put on a QM/QG spread at 9:1 or so in the heating season. Always watch how the rolls will affect your QM/QG spreads, particularly in February, March, October, and November. It sucks to get stuck between a loss you don't want to eat and a contract you don't want to roll.

Martin

Thanks.

I am done with the spread for this year because of that very fact (plus, rolling is a pain with IB, since you have to roll every month). I took off the spread last week when NG was around 7. Who'd have guessed that it would pop up to over 8 without a bona-fide hurricane threat? I should have just taken it off my screen.

I've considered doing the winter short NG/long crude, but I would not be as eager to short NG in the winter because there is a real danger of getting caught short because of the inelasticity. I am not as uncomfortable about being short crude because whereas people can cut down their driving, they don't want to freeze.

 

[scriabinop23]

Quote from smilingsynic:

Thanks.

I am done with the spread for this year because of that very fact (plus, rolling is a pain with IB, since you have to roll every month). I took off the spread last week when NG was around 7. Who'd have guessed that it would pop up to over 8 without a bona-fide hurricane threat? I should have just taken it off my screen.

I've considered doing the winter short NG/long crude, but I would not be as eager to short NG in the winter because there is a real danger of getting caught short because of the inelasticity. I am not as uncomfortable about being short crude because whereas people can cut down their driving, they don't want to freeze.

Tell me about it. I went long averaging in 5 contracts on thursday right after that withdrawl natural gas report.
Not comfortable holding that much downside exposure for long. I was averaged in around 7.12. I sold 3 of them off around 7.25 on Friday, and the remainder 2 early in the morning today at around 7.57 average. I didn't do bad, but if I only let the 5 run...

I need to learn to let things run a little better. Its just so often the morning overshoots, so I figured I'd get out and cash in on my nice 40cent weekend gain. The fact that there wasn't a buying frenzy immediately when that bullish EIA report came out was another mixed signal. I figured, what are the odds this thing will go past 50-60 cents today (only a handful of days like that in the past year), so I sell.

Too many bad experiences holding on too long and letting my gains go.. Such is life in short term position trading.

Now I'm taking the risk and attempting to fade this. 2 contracts averaged sold at 8.17. No hard stops. I may add to the position somewhere around 8.50. This thing overshot too fast. I'll be out if there's a hurricane. I'm looking for a quick fade - not a long term short. I'll be happy with 15-30 cents.

Hopefully I'm not too early. The shorts are out, and probably want back in soon, I figure. No real hurricane threats and the worst heat should be done by the end of the week.

PS If this is global warming trend (probably), how the markets could react to warmer winters and hot summers. We'll have to drawdown reserves in the summer instead.

 

[smilingsynic]

Quote from scriabinop23:

Tell me about it. I went long averaging in 5 contracts on thursday right after that withdrawl natural gas report.
Not comfortable holding that much downside exposure for long. I was averaged in around 7.12. I sold 3 of them off around 7.25 on Friday, and the remainder 2 early in the morning today at around 7.57 average. I didn't do bad, but if I only let the 5 run...

I need to learn to let things run a little better. Its just so often the morning overshoots, so I figured I'd get out and cash in on my nice 40cent weekend gain. The fact that there wasn't a buying frenzy immediately when that bullish EIA report came out was another mixed signal. I figured, what are the odds this thing will go past 50-60 cents today (only a handful of days like that in the past year), so I sell.

Too many bad experiences holding on too long and letting my gains go.. Such is life in short term position trading.

Now I'm taking the risk and attempting to fade this. 2 contracts averaged sold at 8.17. No hard stops. I may add to the position somewhere around 8.50. This thing overshot too fast. I'll be out if there's a hurricane. I'm looking for a quick fade - not a long term short. I'll be happy with 15-30 cents.

Hopefully I'm not too early. The shorts are out, and probably want back in soon, I figure. No real hurricane threats and the worst heat should be done by the end of the week.

PS If this is global warming trend (probably), how the markets could react to warmer winters and hot summers. We'll have to drawdown reserves in the summer instead.

With NG still with reasonably plentiful supply, it is better to be nimble and cash in a good profit then to risk watching it go away in a gap down.

Good luck with the short.

I'm watching NG, and I'd short on a gap down. If I do short, I'll watch it even more closely.

 

[scriabinop23]

Quote from smilingsynic:

With NG still with reasonably plentiful supply, it is better to be nimble and cash in a good profit then to risk watching it go away in a gap down.

Good luck with the short.

I'm watching NG, and I'd short on a gap down. If I do short, I'll watch it even more closely.

Its a tradeoff I'm learning to negotiate. The rewards (and losses) are much more if you let things run their course during night.

Thanks for the luck. Its a bold position, because after a day like today, you realize how irrational the market proves itself to be. 14% in one day is wild. And may I say, a wonderful trading opportunity.

 

[ssternlight]

The risk is why I was thinking of selling the Sept/Oct spread if I were going to get in on this trade.

 

[scriabinop23]

Quote from ssternlight:

The risk is why I was thinking of selling the Sept/Oct spread if I were going to get in on this trade. [/QUOTE

what would your entire strategy of follow through be ? length, closing, rollover, etc.

I assume you'd sell the volatile front month and buy the later month. Would you enter both sides at the same time? Or wait for a drop to buy the back month ?

 

[xtrhvydty]

also XTO

 

[ssternlight]

Quote from scriabinop23:

Quote from ssternlight:

The risk is why I was thinking of selling the Sept/Oct spread if I were going to get in on this trade. [/QUOTE

what would your entire strategy of follow through be ? length, closing, rollover, etc.

I assume you'd sell the volatile front month and buy the later month. Would you enter both sides at the same time? Or wait for a drop to buy the back month ?

Yes, I would enter both sides of the spread at the same time. The strategy would be to sell the long side on the first gap down and ride the short side to a consolidation point -- intraday or otherwise.

If there was no gap down then it would be a hold to expiry with a small -- I'd assume -- loss or gain.

Does that sound realistic? I've never traded this animal before and I see it's made a good start on another leg up this morning. The spread is the same as last night's close while a naked short would be out @ .2

 

[scriabinop23]

i'm out of the trade. here's how it went.

a. originally, i sold short 2 contracts average 8.17

b. last night, i put in a sell order for 1 contract at 8.50.

c. the order filled this morning.

d. nervous that this thing would continue to rise, because I didn't expect it to keep going past 8.50 resistance so far (there was no resistance), I actually entered a spread, but bullish to gain on a continued rise. foolish... bought 5 Oct at 8.80. sold 5 at 8.74 after I saw it dropping quickly past my predetermined threshold. kicking myself for even entering this trade.

e. The freefall started. When morning rush hit, I sold 1 more (total of 4 now) Sep at 8.08.

f. covered 4 at 8.065 when I saw second test towards 8.10 resistance.

In the end, I gained $1632 on sep, lost $771 on oct. I exited Oct properly, just should have never entered it.

All is well; I am new to trading and these kinks will iron out over time. Overall, I'm learning to stick to the plan.

I think this $7.90-$8.10 is a solid price at least until the next gas report comes out Thursday.

I'm going to repost this and keep a journal.

 

[Sparohok]

Hey guys,

Anyone know an online broker where you can execute native intramarket calendar spreads on Nymex contracts?

Thanks,
Martin