Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Natural Gas: Will This Flying Saucer Be Shot Down Without Warning?

Published 01/18/2018, 03:01 AM
Updated 07/09/2023, 06:31 AM

Natural Gas futures price zoomed on January 17th, 2018 despite the fact that it has already spurted 24% in a month. Natural gas bulls seem to be riding in a flying saucer in the bears’ territory. Any flying drone in a rival’s territory is always shoot-down without warning all of a sudden. Drones are not needed to be warned because they do not have any pilot to hear a warning and secondly they do not have any valid reason to fly.

Natural Gas Futures Historical Data

Natural Gas Futures Price Historical Daily Data From Decemer 18th, 2017 To January 18th, 2018

Observations

On observation of the movement of Natural Gas futures price in different chart patterns on January 18th, 2018, I find the natural gas futures price are current facing stiff resistance at the current levels.

Natural Gas Futures Price Daily Chart - Expected Trading Zones

Natural Gas Futures Price Daily Chart - Expected Trading Zones

Conclusion

On analysis of the movement of Natural Gas futures price in different time frames, I find that the price level have touched the second strong resistance at $3.288 with only in hope of flip-flop weather announcements. Natural Gas bulls who are riding in this flying saucer do not want to hear any warning signal. I find the following valid reasons for bears to shot down this flying saucer:

1. In case of any change in current weather reports, we could see a sudden selloff with the bottom dropping out.

2. The Houston Chronicle reports that shale drillers “fearing sanctions by the state, some North Dakota oil drillers have begun cutting output to control the amount of natural gas that's being burned off at well sites and wasted as a byproduct of crude production.

3. The state's gas-gathering and processing capability is 2.1 billion cubic feet daily. In November, the latest figures available, the industry was right at that ceiling - with record 2.09 billion cubic feet (0.06 billion cubic meters) of natural gas produced daily.

4. Pipeline capacity is adequate to move the natural gas to market, but it's the lack of gas-gathering and processing facilities in between that's the problem.

5. Expected storage report of -199 Bcf would be compared to -230 Bcf last year and -203 Bcf for the five-year average.

Disclosure 1. This content is for information and educational purposes only and should not be considered as an investment advice or an investment recommendation. Past performance is not an indication of future results. All trading carries risk. Only risk capital be involved which you are prepared to lose. 2. Remember, YOU push the buy button and the sell button. Investors are always reminded that before making any investment, you should do your own proper due diligence on any name directly or indirectly mentioned in this article. Investors should also consider seeking advice from an investment and/or tax professional before making any investment decisions. Any material in this article should be considered general information, and not relied on as a formal investment recommendation.

Latest comments

Abent a radical change to current rest of winter forecasts (from warmer than normal to colder than normal, US-wide through March), I agree with you completely- time will tell :)
How hard would be to send all the well hookups to one HUGE gas gather?. . Or freeze it into LNG on site with a gas power generator?. . Why lose money and waste it?
You did good job. Thank you.
Rocking..... thank you again sir
I dont understand you in November you were saying that the market was going to fly to 3.40 3.50 and the mkt crash all the way to 2.50, i wont be surprised if the market now goes to 3.40 3.50. Give me a very good reason given the draw and export expectations to short this mkt.
Lol
Satendra is doing and awesome job and many people here appreciate his analysis , now I agree that may not come 100% a
May not come 100% correct but no one in this world has been correct even I have been reading other websites analysis and mostly were wrong , I hope to keep looking into Satendra analysis as they are quiet helpful .
Can you post an escape tunnel analogy like you did an escape chimney for the bears last month :-) thanks.
Dear.Mr. VV, thanks a lot for your valuable comments. I work hard a lot only for the people like you. I I really feeling satiated after reading your comments that you still remember that bear escape tunnel. Dear V.V. when I wrote that nobody wanted to believe on my analysis but it proved. I have already defined the same phenomenon in my last analysis https://www.investing.com/analysis/natural-gas--a-microscopic-view-200280397 and soon you will find this in reality.
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.