Crude oil and the distillates have already started to trade lower as one can see by examining the charts on those 3 products. The lone holdout in the energy complex has been natural gas but based on the near 5% correction today and the failure to hold onto early gains this could be the beginning of the correction forecast in recent weeks.
See in the chart above the 18 day MA identified by the blue line was challenged on its lows today. I have advised traders to scale into bearish plays using the Fibonacci levels as their targets on the way down. My favored play currently is shorting NGZ12 futures while simultaneously selling just of the money puts 1:1. I think an additional 25-40 cent break could happen in the coming weeks. On that look to capitalize on shorts and then reverse in an attempt to gain on bullish exposure into the winter months.
To discuss in more detail this chart or any other you can reach me at:
mbradbard@rcmam.com or 954-929-9997
Risk Disclaimer: The opinions contained herein are for general information only and are not intended to provide specific investment advice or recommendations and are not tailored to any specific's investor's needs or investment goals. You should fully understand the risks associated with trading futures, options and retail off-exchange foreign currency transactions ("Forex") before making any trades. Trading futures, options, and Forex involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change without notice. Past performance is not necessarily indicative of future results.
I have over 1 decade of experience in the Commodities industry. Managing my own IB for over 5 years and my own CTA for fifteen… More