Morning Thoughts – Oldinvestor

I can’t seem to think of all angles when I’m writing. As a look back. Power burn has been hanging in there, and at times, giving demand the extra boost to offset any lack of demand by the drop in LNG exports.

Daily US production as of 8/24/20, fround from HFIR latest free article.

I believe power burn growth by natural gas as a fuel has slowed this year. I remember seeing some numbers a year ago that showed new construction slowing for natgas powered electric power plants. But natural gas prices have helped the fuel continue to grow as the preferred fuel

Natgas and other fuels by % of total electricity generation found at Bluegoldtrader latest article

The above image would shows a couple of things. Natural gas has room to be the fuel of choice by a large margin, from just a few years ago. Though it is unclear how much growth has been in the electric power sector for natgas with this one image; it is clear how much potential there still is for natgas growth when the price is right.

In the bluegold artcle, they share what they are seeing in pricing of coal vs natgas. It’s worth taking a look at. https://seekingalpha.com/article/4371156-natural-gas-in-electric-power-sector-august-2020-update

I will say it’s a bit late in the season to be talking about power burn, but it is still a factor and will be year after year. I don’t have much to add to this. Production should come back online in the Gulf of Mexico before LNG exports do at Sabine Pass and Cameron. If anything, storm surge/flooding will probably keep boats out a few more days at least.

Here is the latest article I see on this news, and it’s a good source.

https://www.icis.com/explore/resources/news/2020/08/27/10545399/topic-page-hurricane-laura-impact-on-energy-markets

Shipping agency Moran Shipping on 27 August said in a notice that pilot service on Sabine Channel remains closed due to highs and seas offshore, but forecasts showed that conditions should allow for marine traffic to resume by 29 August.

ICIS

I’m guessing it is also possible to see a ramp up in pipeflows to LNG export facilities to make up for lost time. I don’t know for sure, it is just something I’m watching for since there should be more boats in line now to be loaded. Also cancellations continue to slowly disappear.

Something else that may be mentioned in the article would be construction of two more facilities in the same area will be affected. There may or may not be details of these disruptions.

Well that’s all I have this morning. I”m starting on an electrical project with another site that I have been ignoring. It has been stealing some of my time from NG trading, but I’m also comfortable with where I’m at right now. Also I really wanted this site to be for working people as I am; with that, I wanted to make slower, more long term trades that don’t have to be monitored constantly. I feel like a distraction is good for me, to keep from over managing my account. NGETF.com won’t be going away, but as I’ve said before, I might be a little less active.

To check out my other site progress, go to escapeautoworks.com. It is slow going, but it make pick up there a little as I have started to focus on wiring, my greatest strength.

My positions

UNL – 50% holding invested in my $1000 account, now at $1050 or so!

BOIL Covered puts

Covered puts P/L as of 8/27/20

I’ll continue to hold. I am still a bit nervous about the 50 strike put against BOIL, but I did set aside enough cash in the account for all three of these trades to help out with near death experiences (that’s a joke) with this trade. I want to show the progress of this trade over the last month or so. I’ll look back through my posts to get the number and update this post that data later. Good Luck

Oldinvestor

AHHHHH! geez. I just saw that I wasn’t totaling all of the profits and losses. It was only taking the P/L from the first BOIL trade and the first KOLD trade. geeeeez. I’ll fix this, but i don’t have time to go back through and update all those numbers. barf. I’ll share what I have with the 90 strike BOIL covered put

sheesh!

Profit/Loss maintained on 90 strike covered put as underlying value increases.

As I stated, this is on for the BOIL 90 strike covered put. Also the Profit/Loss is including a KOLD profit I took over a month ago. What this chart is showing is that I’m short on BOIL, and my account balance is holding due to the 90 strike put offsetting the loss of the BOIL short. If not for the put I’d be down roughly $1000 in this time frame, had I just shorted BOIL. This is a lesson in greeks as well. Deep ITM options have high delta, giving a strong return when the underlying value changes, keeping my account covered thus far. Now delta will fall as the underlying price approaches the strike price. Also I’m sure there’s more to be said about this, but that’s all I have in my for today. And for the other options, they do have me backward more than the 90 strike put, as shown higher up the post. I just didn’t pay attention because my other investments in this account are more than offsetting this trade. Plus I’m still confident I’ll come out the other side, next spring, with a gain. We’ll see… It’s all a matter of time and not getting delisted.