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Natural Gas At The End Of The 2020/2021 Withdrawal Season - Buy BOIL On Price Weakness


  • The end of the withdrawal season with 1.75 trillion cubic feet in storage.
  • Natural gas has been trending higher since mid March.
  • Warren Buffett bets on no challenge of the June 2020 low.
  • Three reasons why higher lows are on the horizon.
  • BOIL to buy on dips.
  • Looking for more investing ideas like this one? Get them exclusively at Hecht Commodity Report. Learn More »
gas burner
Photo by posteriori/E+ via Getty Images

Natural gas futures were trading at just over the $2.50 per MMBtu level on Monday, April 5. The peak season for demand ended in March. We're now at the start of the 2021 injection season when natural gas flows into storage in the US.

The Hecht Commodity Report is one of the most comprehensive commodities reports available today from a top-ranked author in commodities, precious metals, and forex. My weekly report covers the market movements of over 20 different commodities and provides bullish, bearish, and neutral calls; directional trading recommendations, and actionable ideas for traders. 

This article was written by

Andrew Hecht profile picture

Andrew Hecht is a 35-year Wall Street veteran covering commodities and precious metals.

He runs the investing group The Hecht Commodity Report, one of the most comprehensive commodities services available. It covers the market movements of 20 different commodities and provides bullish, bearish and neutral calls; directional trading recommendations, and actionable ideas for traders. Learn more.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

The author always has positions in commodities markets in futures, options, ETF/ETN products, and commodity equities. These long and short positions tend to change on an intraday basis.

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Comments (36)

beezwaxxxx profile picture
great short too much in storage keep shorting the BS from goldman sachs
@beezwaxxxx that did not age well....
@ziegle9876 , He may have covered on the first dip @beezwaxxxx !
@beezwaxxxx That did not work out well Ngas at $3.72 in JULY. This is NOT in the play book. I have kept adding to KOLD. Grrr!
beezwaxxxx profile picture
short the hype storage high I have a feeling summer will be BEAR it always is
beezwaxxxx profile picture
all hype on that so called cold to me sounds like summer is a dud 2.345
@beezwaxxxx , The heat so far has been delayed.
beezwaxxxx profile picture
keep shorting 2.45
@beezwaxxxx , OK, got it !
$RRC could be a solid value opportunity at the 200 day moving average. The stock closed at $9.00 today, down 7.2%. The worst performer in the industry for the day. Earnings scheduled to be reported on 3/26/21. The company's debt and prospects for higher interest rates weigh heavy on the stock for the foreseeable future even as the balance sheet has improved. A rotation out of the sector and regulatory concerns are headwinds. Currently 11.3% of RRC's shares are held short with 6 days to cover. An unwind of short interest could result in a marked reversal higher. Next week the 100 day moving average will likely be tested again. In the short term, a seasonally bearish time of year for natural gas could sustain a downward move and a test of the 200 day moving average. Growing demand for natural gas, along with the company's low break even costs, low decline rates, high proven and unproven reserves, are tepid reasons for optimism as other short/intermediate term growth opportunities in other sectors look more appealing.

This is only me thinking out loud for future reflection on my thinking at this point in time.

None of this is investment advice. Do your own due diligence.
@Dan_43210 , Your due diligence is good enough. I am staying out of it.
beezwaxxxx profile picture
look for a break of 2.345 then sub 2......go long sub 2.....we are starting summer with more then enough storage....so far all my calls came in........july starts summer now you might get some hype but thats all hype..enjoy i will bullish sub 2... sadly my bears days almost done
@beezwaxxxx , Your bears days almost done?
beezwaxxxx profile picture
@kimbillro yes sub 2 my final call before summer beings need to break 2.345
@beezwaxxxx , I am holding you to it. Sub 2 will be great.
PT Larry profile picture
Thanks for the article.
CawDad profile picture
The 10 year chart looks like it will need an 18-wheeled EV to administer CPR shocks.
This is a tough commodity. I am waiting for a dip into the 2.3s.
What about GASS?
I am long KOLD 34.50 down to 29.50. Sept Oct 2020 and Feb 2021. Nice gains. I agree with maybe going long BOIL ( very decaying) but not with $Ngas at $2.50. Maybe low 2 dollars. I watch and compare both charts.
@jzut , So, you think down? @Beez@beezwaxxxx
@kimbillro Yes. I would maybe start a position in BOIL with $Ngas around $2.25.
@jzut , Your not going to ride it down with KOLD?
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