Morning Thoughts – Patience

My positions as of pre-market 3/1/21

I saw something of a bullish weather related shift. I am on the fence as to whether or not to add more UNL. I think the market still needs time to settle from the winter blast. Production:

Production numbers: found in the latest free article by BlueGold Trader

As we can see, the production numbers are quite out of alignment. Demand is the same.

Natural gas Balance, by BlueGold Trader, same article as shared in the image above.

Either image shares a link to the BlueGold Trader article the images came from if you’d like to give them a visit. Anyway, as you may have already seen and heard, the market swung hard to under-supplied for quite some time. According to Bluegold, the market nearly swung back to a balanced market. At least this is what the data they are receiving shows. This data is only a sample of the entire market and may be harder to trust than in times of fundamental stability.

It does appear the market is settling down and with a Sunday gap up, the market may be interested in a bottom here. Based on EIA info, $2.75 is getting quite close to a historical low vs storage. Also, the light blue dots are 2019, when storage was building faster than the 5 year and the market was anticipating more of a surplus. I would say right now it is hard to tell which way the storage scale will tip. I think power burn will be ever more important this summer. LNG will of course steal the spotlight if there is another LNG global glut. I’ll be keeping these in mind when summer approaches.

EIA weekly dashboard Storage surplus/deficit vs pricing

As for my positioning………..

UNL/UNG/BOIL showing a percentage comparison between the three on

Based on this move, which is a rather strong one, UNG can move about 1.83 times faster than UNL, and BOIL 3.44 times faster than UNL. I did a quick calculation in excel.

comparison of positions

Based on the amount of UNG ($95.7), and BOIL ($23.86) that I’m currently holding. I would need roughly a total of $257 to offset these short positions. I am currently holding $406.05 purchased shares worth of UNL, which would make me clearly long biased.

gotta go, apparently all hell is breaking loose and I must go.

I will be holding my positions steady today. Good Luck


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