Morning Thoughts – time to reduce

My positions pre-market 1/5/2021

I will be reducing, but not until the market opens. My account is showing a larger UNG profit than it should; my short call will offset some of this at market open. UNL will also gap higher at market open, so my balance may remain about where it is now. This being the case. I plan to roll my UNG call forward today and reduce UNL to 50 shares at market open.

This move is a not surprising, but is nice to wake up to. Other than a trend and the price considered to have gone too low in the first place, I’m not certain what would be pushing prices higher at this point. I’m content with my position and my little profits, Part of me is just ready to be out for a bit. I could just dump my UNG position, as it is very near max gain…. I will elaborate on that in a moment

EIA Storage Surplus vs Prompt Pricing

First. Keep in mind the pricing chart above. Prompt pricing is still well under the $3 bar, and this is what I would consider the ceiling for now. Technically UNG/UNL has a little more room to move higher still. Storage is still at a surplus to the 5 year average, so I don’t feel pricing will rush to move above $3.

So I’m reducing UNL to 50 shares at market open, and rolling my UNG call out by 1 week to 1/15/21. I should still add 10 cents in premium potential to the trade and I can still make max as long as UNG stays above $9 by 1/15/21. If UNG starts trending down, I’ll cover the trade. I think it’s safe to go ahead and roll out another week at this time. I’ll take it one day at a time beyond that. Good Luck



I dumped all my UNG because the options premium started getting away from 10cents to roll forward to 1/15/21 expiration.

updated positioning 1/5/21

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