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Elgrey

Elgrey
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  • Natural Gas Changed Direction Again - Will It Remain Range Bound? [View article]
    Interesting. I bet the peaks on that charts are the periods when prices doubled over just a month or so.
    Sep 9 11:21 PM | Likes Like |Link to Comment
  • Natural Gas Changed Direction Again - Will It Remain Range Bound? [View article]
    Lior, correct me if I am wrong but NG is always in very steep contango. So, I would not rely on this particular factor factor in case of this particular commodity.
    Sep 9 09:51 PM | Likes Like |Link to Comment
  • Coffee Holding, Ready For A Parabolic Move? [View article]
    Be careful with prospects of coffee market. Prices are not justified by fundamentals, see COT report - coffee users are very, very short. And they know real picture for real.
    Sep 6 08:10 AM | 1 Like Like |Link to Comment
  • A Look At Various Commodities And Weather [View article]
    James, do you incorporate Commitments of Traders report in your analysis? Asking cause coffee and cocoa reports do not seem bullish at all and sugar report while looks promising does not confirm that bottom has been reached yet.
    Aug 29 01:54 AM | Likes Like |Link to Comment
  • Will Natural Gas Keep Recovering? [View article]
    Agree, but one thing to add, this is from my practical observations - whenever these two groups of players (users vs speculators) are at their extremes (extreme long or short) that does not necessary mean that prices change the direction "this very moment or very-very soon" in two frequently occuring cases - (NYSE:A) both groups may hold positions for weeks, and (NYSE:B) first days (or even weeks) of stealth buying/selling may pass undetected for most of the market and prices won't change their direction attracting last unaware latecomers.

    This is the case for natgas market these days - specs are very bearish and hedgers are very bullish. This time it is difficult to say "they've been at extremes for X weeks already" cause they built up positions gradually, without strong movements. Therefore I would not expect situation to unwind in an eye blink.

    Thinking from a slightly different angle one could say - alright this winter could possibly be mild because of El Nino so why should I stop shorting? Also, gas company could say - alright storages were depleted severely and have not been rebuilt yet so why should we stop being long? And both parties may hold their positions for a while.

    That's the reason why I am betting on neutral trend. But like Lior said it is only a guess.
    Aug 20 02:52 AM | Likes Like |Link to Comment
  • Will Natural Gas Keep Recovering? [View article]
    Lior,

    I am not so good in natgas as you are but in my opinion bears should start thinking of reducing their positions. Last weeks the pace of injections was good but we have storage shortages we haven't had for many years and this pace does not seem fast enough to cover the deficit "in excess". Weather was also supportive on the East Coast but the picture is changing now, end of August will be warmer than usual. Last thing to mention but first thing to consider - Commitments of Traders report. It is speculators who short the market right now while commercial users are very bullish.

    Personally, I transformed my short position into a neutral strangle, betting on neutral prices.
    Aug 13 10:05 PM | Likes Like |Link to Comment
  • Time To Get Some Coffee [View article]
    "Coffee for dummies" style article. What Starbucks did, what consumption will be in 30 years, what facts are about JO - all of this is irrelevant.

    Nothing is said about large carry over stocks. They are about 12-15M bags. Excess of demand over supply will probably be about 5-6M bags. This means there would be lots of stock carried over.

    Nothing is said about good robusta crop in Vietnam, arabica substitute.

    Nothing is said about positioning of users of coffee, hedgers (they are net short coffee) and speculators (they are net long coffee) and both are at the levels close to extremes meaning there is not much room left to sustain the direction increasing odds for reversal.

    Fundamentally speaking there is no info about crop final figures. All we have is estimates of exporters who are interested to heat up the market and analysts who predicted bull market in coffee months ago - I remember reading a big article about coming bull market exactly on the day when prices peaked and began a several month downtrend from 2.25 to 1.60. Such analysts do not have incentive to be honest with you, they are paid by other guys, they say BUY when they already bought and want you to buy to earn them profits. The more BUYs you hear the more you should think about selling.

    In the absence of reliable info one needs to consider COT data seriously and wait for trustworthy crop figures. Otherwise you are going to spend your money buying a coffee ETF at peak prices and then you are stuck with it waiting until next year crop hoping for prices to shoot up.

    Coffee is extremely dangerous market, it is filled with speculators, last days we saw 5-6% moves for no solid fundamental reason. Do not rush in until you get a firm understanding on what you are about to bet your money on.
    Aug 4 10:00 PM | 4 Likes Like |Link to Comment
  • 3 Questions Regarding The Recent Fall In Natural Gas Prices [View article]
    Lior, +1 on your analysis
    Jul 31 01:47 AM | 1 Like Like |Link to Comment
  • Agriculture Out Of Favor... But For How Long? [View article]
    Welcome back Matthew
    Jul 18 09:32 PM | Likes Like |Link to Comment
  • NatGas Poised To Fall Below $4 Amid Extremely Mild Summer [View article]
    Maybe you are right. I am bearish too, shorting November calls.
    Jul 15 04:48 AM | Likes Like |Link to Comment
  • NatGas Poised To Fall Below $4 Amid Extremely Mild Summer [View article]
    A month ago this guy called for USD5.00 and he was wrong so far. In fact his article coincided with this summer peak of NG. Of course he made a disclaimer saying "if the weather gets hot" but he was insisting on a bullish run several articles in a row. I remember that because I was thinking of opening a bearish position and his words puzzled me.

    What he missed was El Nino impact - summers in the US are wetter and milder during El Nino years. Do not take well-dressed opinions very seriously, especially when they never review own past predictions and instead keep coming with new ones. Use your brain, #1 commodity writer on SA means nothing. No pun intended.

    PS. My take is that there is still steam for NG bears run but not that much. NG lost 65 cents already, do not think we have more than another 20 cents to lose. But who am I to give a judgment?
    Jul 14 02:35 AM | Likes Like |Link to Comment
  • U.S. Natural Gas Export Era Begins In 2015, Fueling Upside In Prices [View article]
    Nat gas for delivery in 2014 won't be affected. But in future, yes, prices will grow due to export.
    Jun 23 11:16 PM | 1 Like Like |Link to Comment
  • Natural Gas Seasonality Suggests Price Peak Imminent, But Don't Count On It [View article]
    My bet - in two complete business days prices will be about levels they were just before the report. Betting is wrong when it comes to markets though))) But honestly I cannot see solid ground for this rally.

    Also, this is a normal thing to see 3-5% swings when estimates are not met by 1-2%. Speculators.
    Jun 12 11:24 PM | 1 Like Like |Link to Comment
  • Natural Gas Seasonality Suggests Price Peak Imminent, But Don't Count On It [View article]
    Let me rephrase my saying about share of natgas coming from oil wells. It is not >>50%, no. EIA tells us about present numbers of oil+gas wells as Itmojo correctly outlined. What they do not tell us is bbu amounts taken away from each well type in 2013 and 2014. The data EIA website discloses on that is outdated. Do not ask for the link, look for it yourself, I will not do your homework. Move your bum if you want a buck.

    When you find the data I am talking about, consider the change in rig counts (this data you already have) and extrapolate the amounts taken away from oil+gas rigs at present. The share of output from oil+gas wells should the lower then sum of outputs from conventional gas wells and shale gas wells but higher than individual amounts of the two.

    But even if we are talking about 30-40% of total output this is material and cannot be taken off the table.

    Not to mention that this rate could be improved further because burning by-product gas is stupid when land rates are so high and everyone is talking about future of LNG and changes to the US LNG export legislation.
    Jun 12 12:09 AM | 1 Like Like |Link to Comment
  • Natural Gas Seasonality Suggests Price Peak Imminent, But Don't Count On It [View article]
    Speculators are undecided - they are right about the midpoint - neither extremely long nor short.

    It is hilarious to see all these discussions about natgas low rig counts when it is a fact that a lion share of natural gas is produced as a by-product of oil drilling. Btw the author wrote about it http://bit.ly/1phV9c5 More than half of wells produce both gas and oil. That is why looking at ng rig count alone is wrong. And oil rig counts are at all times high. OK, put the numbers away and give an answer based on pure logic - "How come there are triple digits injections when rig counts are at lowest levels?" The answer would be "Then it is not just gas rigs that should be counted".

    One more person mentioned El Nino correctly - summer is probably be wet and calm.

    And for all these talks about Russia-China deal and other very-very long-term stuff - fine, eventually these will shoot up. But most readers are concerned with shorter-term time horizons, not 5-10 year ones.
    Jun 10 09:30 PM | 3 Likes Like |Link to Comment
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