Global Macro Perspectives
First big draw happened one week later than I thought. Natural gas in storage fell 64 Bcf. UNG is trading up 7.7%. Chart 1. Natural Gas Futures (Weekly) Chart 2. Working Gas in Underground Storage Compared with 5-year Range
Natural gas in storage rose 2 billion cubic feet in the latest week. No draw I speculated about in the UNG post. Closed the UNG postition at small loss. Chart 1. Working Gas in Underground Storage Compared with 5-year Range
I eagerly started my strategy series and invested opposite the same day. So much on strategy and trading having common points. The United States Natural Gas Fund (UNG) has hit new lows yesterday and I couldn’t resist taking a position. I bought ATM April Calls. Had to close FXY position (with a small profit) to […]
I am starting a monthly strategy overview to have my strategy in one place and a to test accuracy of my views. Written revisions and accommodations would also contribute to my investment discipline. Equities I have been surprised by the market strength as the market rejected the Dubai turmoil as a correction catalyst. This has […]
A lot of action on the earnings losses and economic announcements front. So, let’s start. Initial jobless claims came at 512k vs. 523k consensus and 530k the week before. Finally some improvement, but still at some 170k job losses a month.
Markets, off-course, cheered the data. All major indexes ended with nice gains of a 2% and more. We will see if the positive action continues after the tomorrows unemployment figures. Could be, consensus on non-farm payrolls is pretty low at 175k job loses, I think we could manage to beet that.
Excess gas coming to the spot markets due to light demand and curbs imposed by pipeline industry continue to cause wild swings in the spot markets. If we look at the futures markets those swings are not so strong probably due to size of futures markets in comparison to physical markets.
Natural Gas in the worst performing commodity this year. It has come down 66.2% this year and 77.6% from the top. Reduced industrial demand combined with absence of hot weather which has reduced electricity demand and consequently natural gas demand has weighted heavily on the natural gas price.
We have had some spectacular runs from the recent lows both in the equity arena and among commodities. As I am writing this introductory post markets are hitting new highs for the year. Common to these diverse markets is that we have seen little or no material improvement in underlying fundamentals only consolidation at initially depressed levels.