Morning Update Feb 11, 2020

It seems I’m not off to a good start this morning. I added a plugin to tweet my posts when I publish them. Apparently one must transition their twitter account to a developer account, bla bla bla. Aint nobody got time fo that…

So weather is not even trying to tease us with the idea that cold patterns are forming. I would attribute this last fall into a new range some to weather, some to other fears of swinging back to an oversupplied market. More severe oversupplied market rather. Production seems to be back on track to it’s slightly oversupplied state, with what seems to be a slight down trend.

Production YoY shared by HFI Research here

HFI will share their production numbers once and while for free. The article the image above is shared in a free article . This image is before there was a dip in production. Production has returned to these levels, but there is a slight downtrend. I am, without a doubt, sure this will continue at these prices. Most producers had to adjust how they did business after 2015/16, but didn’t get much time to recover. Production most likely not create new highs from here, and mostly likely trend down this year.

UGAZ on 1hr chart at Webull

So I had drawn these lines to kinda represent where maybe I should have bought UGAZ. I have them almost evenly spaced because this seems to be the pattern, prices fall another leg lower and range from there.

Since I am feeling a bit shy about entering the market further with UGAZ, for now I’m going to hold what I have and not add to my long position. I admit I feel a bit emotional about what might happen with the LNG market. LNG exports does account for near 10% of U.S. natgas demand; this is plenty to pull the price down further if LNG exports slow. I don’t think it is time to panic and flee the market. If natgas prices drop sharply, this is an opportunity that will not wait, and I will surely add to my long positions. For now, I just need to wait. If anything drastic changes, i will post to Twitter. Good Luck