Morning Update March 4, 2020

I don’t have much time today. The one thing that stands out right now is a drop in production. HFI Research mentions a drop in the Permian area due to negative regional pricing. https://seekingalpha.com/article/4329329-natural-gas-bearish-weather-persists-production-drop-in-permian-starting-to-get-meaningful

NG1 on 2hr at Tradingview.com

I’m showing a bit of a breakdown. Pricing has broken away from the up trend some, and RSI showing some slowdown before the break. This is more to do with the coronavirus and the interest rate change yesterday afternoon.

I’m torn on whether I should hold or reduce a little. By a little, I mean 5% of my funds. My current break-even price is $15, If I were to reduce by 5%, I would scrape a small gain (less than .5%) and my breakeven would bump up to $15.05. I’m going to hold.

I feel the market could move in either direction from here. If production is going to slow by 1Bcf/d, this should help support pricing. Winter is over, and I believe no one is considering that anymore. Storage figures still matter (which weather does still affect), and the market is very close to being balanced in relation to the 5 year average, even with terrible weather figures. A 1Bcf/d drop in production from this point could tip the scale. But production doesn’t just drop 1Bcf/d and stay that way.

I’m going to hold my 75% in UNG. If prices do not go up today, I’ll reconsider dropping 5% of funds. For now I’m holding. I forgot to mention earlier, I’m placing a limit order on UNG to sell down to 50% holdings at $15.05. I’ll be reducing 25% of my funds in UNG. Good luck

Oldinvestor

Side note: I’ve bought ZM (Zoom Video Communications) with 1% of my account in my 401k account. They report earnings today after hours. I’m not expecting earnings to jump. Most of the time companies include expectations of future revenue, this is what I’m expecting to be big news. The company I work for just cancelled some flights to some location that I’m probably not supposed to say. I’ve heard many Walmart buyers are not going to China right now. I think ZM has been and will continue to reap the benefits that only a video conferencing software can reap from the coronavirus a little longer.