Essence of the trade: Commodity market overselling and momentum has extremely high negative sentiment right now. Weather forecasts an especially warm summer which is good for nat gas (primarlily used for houshold and commercial cooling in the summer in the EPCOT (texas) and New England area). Additionally another positive catalyst is the potential of these tariff energy deals that could come with other countries, specifically Asian one's like indonesia which has already promised to buy 8 billion dollars in energy (NG) to reduce the trade deficit. That being said other than these positive catalysts, fundamentally we are still bullish, storage is still 3% below the 5 year average with the most recent EIA report being bullish (less injections than expected) yet prices have continued to fall from momentum/algos. I see a turn around coming over the next 1-2 months, and am taking the june UNG calls at 16 strike as my play. Put roughly 50k into it, and holding another 50k in case it continues to dip.
#Long Nat Gas position
half solar
On the futures contracts itself, May is currently hovering at around 3 dollars, where I think the fair price is closer to 3.4 ish right now, with plenty of potential positive movemenet
on the technical side there is really strong support at 2.95 level and the 3 dollar level as well
gonna start taking profit when ung hits 17.5 ish
just because this is such a large sizign
made around 120k from my last nat gas short going into this down swing, am pretty confident on this trade lmk if u have any questions
half solar
the bear case is saying theres momentum down to 2.75 which is honestly not even that low tbh, so I'm holding out the rest of my position in case this sentiment happens, this honestly just my "optimal" risk factor in case things blow up since I'm playing options rather than the underlying
additional commodity news is im eyeing a copper short if we see futures price hit 5.1 again
half solar
eia report yesterday came bearish at 88 bcf but todays bounce signals the bullish sentiment thats started
looking rlly promising tbh
half solar
Closing another half today
half solar
Profit taken around 25k, holding the rest of the 40k in contracts rn
half solar
may sell a little more tomorrow