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Nat Gas Bullish , not Bearish!
Started:October 15th, 2016 (12:58 PM) by josephBus1 Views / Replies:1,478 / 61
Last Reply:December 6th, 2016 (09:54 AM) Attachments:12

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Nat Gas Bullish , not Bearish!

Old November 4th, 2016, 11:03 AM   #41 (permalink)
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jokertrader View Post
Thanks how about h/u last winter? March vs sept

While it might seem obvious but H/U is just H/J plus J/U. I say that because H/J is an extremely volatile spread, and J/U isn't. As such H/U will correlate very highly with H/J.

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Old November 5th, 2016, 07:17 AM   #42 (permalink)
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Thanks spot prices way down does that mean gap down for futures on Sunday night or Monday morning??


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Old November 5th, 2016, 05:24 PM   #43 (permalink)
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jokertrader View Post
Thanks spot prices way down does that mean gap down for futures on Sunday night or Monday morning??

When you say spot prices what do you mean? Physical gas for flow the next day has to be scheduled by 11am, so all of that trading was completed before the futures closed. Most Balance-Month trading is spread related to futures so I think its unlikely physical trades from Friday will infleuence the Sunday reopen.

Having said that, next day flow on a Friday is actually a three day package of gas for Saturday, Sunday & Monday. As such, with all else being equal, since Saturday & Sunday have lower demand than weekdays, the Friday physical price tends to be lower than Monday thru Thursday trading.

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Old November 6th, 2016, 07:47 AM   #44 (permalink)
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I was referring to the NatGasIntel article

NatGas Cash Tumbles, But Futures Steady; December Holds $2.77 (sorry i lost my free access) but when i read it, it said something like cash was down on Friday about 17 to 19 cents depending on the area.

If you look at the cash price on Barchart.com, you also notice cash prices down
https://www.barchart.com/futures/quotes/NG*0/all-futures

But your explanation is logical.. which implies.. cash prices could go up on Monday.. which could mean NG futures also having a gap up day.. which is contrary to my initial thinking of we will have a Gap down on Monday since cash prices were lower to futures

Not sure if i am readiing this correctly - your insight is highly appreciated
thanks

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Old November 6th, 2016, 09:30 AM   #45 (permalink)
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Reading the COT report

Futures Edge on FIO
Commitments of Traders - CFTC

You can go here and click on Nat Gas and Short Format:

a) First 2 sections seem to be Nat Gas and others other things - yes/no?? So have to look only at 1st 2 sections
b) Seems like Producer merchants are still net much more long though they reduced from week ago whereas Swap Dealers are net Short over 4 times of the longs and managed money is still net long - correct?
c) any easier way in graph format to see this?


Thanks SMCJB ( i found it in an old reply of yours - after skimming through 74 pages of your quotes/posts - why?? topic for another time but thanks for all your contributions)

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Old November 6th, 2016, 11:14 AM   #46 (permalink)
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jokertrader View Post
But your explanation is logical.. which implies.. cash prices could go up on Monday.. which could mean NG futures also having a gap up day.. which is contrary to my initial thinking of we will have a Gap down on Monday since cash prices were lower to futures

Actually it should imply that the Cash-Futures spread will be tighter than it was Friday, not that the Futures will do anything,

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Old November 6th, 2016, 11:54 AM   #47 (permalink)
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jokertrader View Post
Commitments of Traders - CFTC

You can go here and click on Nat Gas and Short Format:

a) First 2 sections seem to be Nat Gas and others other things - yes/no?? So have to look only at 1st 2 sections

That's just ICE. You need to go down and find the NYMEX contracts as well...

1 - NATURAL GAS ICE HENRY HUB - ICE FUTURES ENERGY DIV 2500 MMBtus
Is the ICE Financial Settled Futures Contract
2 - NATURAL GAS PENULTIMATE ICE - ICE FUTURES ENERGY DIV 2500 mmbtu
Is the ICE Financial Settled Penultimate Futures Contract

Note that ICE actually have lots of different 'Henry Hub' products on exchange, but they all clear as the same products. Henry Hub ICE lots are 2500/MMbtu/Month, ICE Henry Hub are 2500/MMbtu/Day. They also have a Jumbo contract that is larger but it doesnt trade.
You might find this interesting. Trading Natural Gas on ICE

Sections 3 thru 35 are a bunch (but not all) of the ICE Financial Index & Financial Basis Products.
Note that ICE Swing Swaps are not reportable. I'll let people deduce what that potentially means.

36 (about 80% of the way down the page) - NATURAL GAS - NEW YORK MERCANTILE EXCHANGE (Contracts of 10,000 MMBTU'S)
This is the NYMEX Physically Deliverable Natural Gas Futures Contract aka "NG".
37 - HENRY HUB LAST DAY FIN - NEW YORK MERCANTILE EXCHANGE (Contracts of 10,000 MMBTU'S)
This is "HH" the NYMEX 10,000 MMbtu Financial Settled Futures Contract
38 - HENRY HUB PENULTIMATE FIN - NEW YORK MERCANTILE EXCHANGE (Contracts of 10,000 MMBTU'S)
This is "HP" the NYMEX 10,000 MMbtu Financial Settled Penultimate Futures Contract
39 - HHUB NAT GAS PENULT FINL-10000 - NASDAQ FUTURES (Contracts of 10,000 MMBTU'S)
This is the NASDAQ copy cat 10,000 MMbtu Financial Settled Penultimate Futures Contract, Doesn't really trade much electronically but NASDAQ's Over-The-Counter Block clearing rate is a lot cheaper than ICE & NYMEX, which when combined with the fact that several of the brokers have a financial interest, means a lot of Options (and delta hedges) are block cleared on Nasdaq.
40 - HENRY HUB SWAP - NEW YORK MERCANTILE EXCHANGE (Contracts of 2,500 MMBTU'S)
This is "NN" and "NNe" the NYMEX 2,500 MMbtu Financial Settled Futures Contract. For a long time this was only executed "Over-The-Counter" and cleared through Clearport, but other the last 3 years NYMEX has made a big push to get this contract to trade electronically and I suspect to take volume away from ICE. NN is 2500/day and NNE is 2500/month.
41 - HENRY HUB PENULTIMATE GAS SWAP - NEW YORK MERCANTILE EXCHANGE (Contracts of 2,500 MMBTU'S)
This is "QM" or the NYMEX eMini Financial Settled Penultimate Futures Contract

As an aside I'm reportable. Not sure which category I show up in though. "Other" I guess.


jokertrader View Post
b) Seems like Producer merchants are still net much more long though they reduced from week ago whereas Swap Dealers are net Short over 4 times of the longs and managed money is still net long - correct?

To get a more accurate picture you need to add all of those up.


jokertrader View Post
c) any easier way in graph format to see this?

I don't spend much time with COT data as it doesn't effect my trading. I do look at it a little though as I get a couple of analytical reports sent to me each week. I believe @ron99 does a fair amount of COT analysis so maybe he can add something. You need to be careful though as a lot of what I see is purely focused on the "NG" contract which to me is like looking at less than half the picture.

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Old November 8th, 2016, 12:30 PM   #48 (permalink)
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testing the waters with a long

trying to catch the falling knife.. lets see
aim to remove before inventory

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Old November 8th, 2016, 06:01 PM   #49 (permalink)
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yep, looks bullish.

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Old November 9th, 2016, 08:05 PM   #50 (permalink)
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I know the joke is on me but under pressure am able to make better calculated moves against trend


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