Natural Gas / NG - Act II: A Number That Starts With "2"
Updated
My previous call on natural gas made Sept. 19 has come to fruition, achieving all three targets, and in a shorter than expected period of time:
Natural Gas / NG - It's Officially a Bear. Now, Hold My Beer
The question I've asked myself for the last few days is simply: Now that the June lows have been taken out, is it time for a reversal?
And frankly, I don't believe a (sustained) reversal is imminent, mostly because I really do believe $18 NG1 is incoming and these market makers, who are total maniacs, will not make it so easy for one to go long.
Things to keep in mind when we're so close to the end of the month and major lows have been achieved:
1. Look out for bounces as monthly candle wicks are painted
2. Look out for monthly candle highs to be painted in the first days/weeks of November
3. Big volume gaps between $6.3 and $5. "It's only 23%!"
4. Big bounce from $4.9 to $5.3 June lows are likely
Trendlines are astrology, for real. Stop believing in them. No banks and no trading floors at Shell, Exxon, Aramco, Gazprom, are sitting there thinking of what to do with billions of dollars of inventory and drawing a diagonal line between two lows and thinking to themselves about such and such "support." That is truly absurd.
Yet, you should pay attention to these things because, to the contrary, they're used to fleece dumb money. The markets revolve around fleecing dumb money, and there are entire funds with billions of dollars of dumb money.
To put this trendline into perspective, although it looks reasonable on the 4H, look how absurd this is on the monthly:
https://www.tradingview.com/x/Bgb0ZMS5/
That being said, it's also reasonable on the 1W and 1D charts:
&
We are notably at that point, below the psychological $5 level and more or less at the trendline, and at the end of the month. When June made its Armageddon move downwards it came right as the monthly contract closed, so I personally do not expect a repeat of the same situation.
I think a bounce to $5.3 is more or less inevitable, and I suspect rather than break through it and act like Silver/Gold/WTI has retracing to newer highs, it will bounce off the low and manufacture the kind of "resistance" found in technical analysis books to encourage late shorts.
Early November may actually show us a more bullish impulse back to $6, but keep in mind that to get back to that mid-October weekly gap would more or less fill the entire October monthly bar with a November wick, so that gap is likely a breakaway gap that will stay in place for some time.
Anyways, what I expect to see is after some retrace to catch late shorts and squeeze and break them, as well as to exploit early bulls, we will see a retrace, one that won't last long and will probably be quickly accompanied by another breakaway gap.
I believe that natural gas will, in a very quick period of time, actually print a number as low as $2.9, a move that will be accompanied by WTI also setting new lows and approaching $50, as I noted in a recent call:
WTI Crude Oil / CL1 - Accumulation Before Global Conflict
Europe has already filled their coffers with $9-10 US LNG delivered via boat and until they need to refill the barrels in a few months after Freeport is re-opened, prices should be suppressed as producers and funds get net long on energy.
The reason is, problems between NATO and Russia and problems between the World and the Chinese Communist Party under the new found "Emperor" Xi and his delusional miscalculation to stay attached to Marxist-Leninism and communism will lead the Party to either attack Russia alongside NATO or to pinch both Russia and NATO with an assault on Taiwan.
Energy will be _extremely_ expensive everywhere once the global conflict breaks out. But as with all such moves, first come lows that are more uncomfortable than early bulls and scared bears are comfortable with.
2023 will not be a pleasant year, so make sure you do your utmost to have a proper Christmas with your family and act like a good person.
Whoever you are who is reading this, what I want to tell you is this: If you want a future, you need to start by first rejecting communist culture, especially all things Marxist-Leninism.
Next, you need to reject the Chinese Communist Party, for it is guilty of the crime of live organ harvesting genocide against Falun Gong and will be purged by history.
Third, you need to start to emphasize virtue and improve your conduct and morality on a foundation of traditional human culture.
I am not talking about dogma, and I am not talking about religion. Both of those are totally useless. I am talking about a rational understanding of what it means to be "a human being," the things that have allowed this civilization and this cycle of history to persist over the last 5,000 years, founded on the back of the Chinese dynasties.
There are so many lessons in history. I hope that whoever has the fortune to encounter my words can walk out of the catastrophe. But if your thoughts are unrighteous, then if you can't, you can't.
Regrets, however, will be no help at all.
It's just like poker: you have to figure it out and have your bets placed before the cards are turned face up. Once the truth is revealed, everything is fixed.
Natural Gas / NG - It's Officially a Bear. Now, Hold My Beer
The question I've asked myself for the last few days is simply: Now that the June lows have been taken out, is it time for a reversal?
And frankly, I don't believe a (sustained) reversal is imminent, mostly because I really do believe $18 NG1 is incoming and these market makers, who are total maniacs, will not make it so easy for one to go long.
Things to keep in mind when we're so close to the end of the month and major lows have been achieved:
1. Look out for bounces as monthly candle wicks are painted
2. Look out for monthly candle highs to be painted in the first days/weeks of November
3. Big volume gaps between $6.3 and $5. "It's only 23%!"
4. Big bounce from $4.9 to $5.3 June lows are likely
Trendlines are astrology, for real. Stop believing in them. No banks and no trading floors at Shell, Exxon, Aramco, Gazprom, are sitting there thinking of what to do with billions of dollars of inventory and drawing a diagonal line between two lows and thinking to themselves about such and such "support." That is truly absurd.
Yet, you should pay attention to these things because, to the contrary, they're used to fleece dumb money. The markets revolve around fleecing dumb money, and there are entire funds with billions of dollars of dumb money.
To put this trendline into perspective, although it looks reasonable on the 4H, look how absurd this is on the monthly:
https://www.tradingview.com/x/Bgb0ZMS5/
That being said, it's also reasonable on the 1W and 1D charts:
&
We are notably at that point, below the psychological $5 level and more or less at the trendline, and at the end of the month. When June made its Armageddon move downwards it came right as the monthly contract closed, so I personally do not expect a repeat of the same situation.
I think a bounce to $5.3 is more or less inevitable, and I suspect rather than break through it and act like Silver/Gold/WTI has retracing to newer highs, it will bounce off the low and manufacture the kind of "resistance" found in technical analysis books to encourage late shorts.
Early November may actually show us a more bullish impulse back to $6, but keep in mind that to get back to that mid-October weekly gap would more or less fill the entire October monthly bar with a November wick, so that gap is likely a breakaway gap that will stay in place for some time.
Anyways, what I expect to see is after some retrace to catch late shorts and squeeze and break them, as well as to exploit early bulls, we will see a retrace, one that won't last long and will probably be quickly accompanied by another breakaway gap.
I believe that natural gas will, in a very quick period of time, actually print a number as low as $2.9, a move that will be accompanied by WTI also setting new lows and approaching $50, as I noted in a recent call:
WTI Crude Oil / CL1 - Accumulation Before Global Conflict
Europe has already filled their coffers with $9-10 US LNG delivered via boat and until they need to refill the barrels in a few months after Freeport is re-opened, prices should be suppressed as producers and funds get net long on energy.
The reason is, problems between NATO and Russia and problems between the World and the Chinese Communist Party under the new found "Emperor" Xi and his delusional miscalculation to stay attached to Marxist-Leninism and communism will lead the Party to either attack Russia alongside NATO or to pinch both Russia and NATO with an assault on Taiwan.
Energy will be _extremely_ expensive everywhere once the global conflict breaks out. But as with all such moves, first come lows that are more uncomfortable than early bulls and scared bears are comfortable with.
2023 will not be a pleasant year, so make sure you do your utmost to have a proper Christmas with your family and act like a good person.
Whoever you are who is reading this, what I want to tell you is this: If you want a future, you need to start by first rejecting communist culture, especially all things Marxist-Leninism.
Next, you need to reject the Chinese Communist Party, for it is guilty of the crime of live organ harvesting genocide against Falun Gong and will be purged by history.
Third, you need to start to emphasize virtue and improve your conduct and morality on a foundation of traditional human culture.
I am not talking about dogma, and I am not talking about religion. Both of those are totally useless. I am talking about a rational understanding of what it means to be "a human being," the things that have allowed this civilization and this cycle of history to persist over the last 5,000 years, founded on the back of the Chinese dynasties.
There are so many lessons in history. I hope that whoever has the fortune to encounter my words can walk out of the catastrophe. But if your thoughts are unrighteous, then if you can't, you can't.
Regrets, however, will be no help at all.
It's just like poker: you have to figure it out and have your bets placed before the cards are turned face up. Once the truth is revealed, everything is fixed.
Note
Literally right off the trendline and back towards the June low.Astrology, it works.
Note
There's actually a pretty apt fractal that somewhat mirrors the existing mega run's pattern that formed Sept-Dec of last year:$6.3 might really be in the cards for November.
Note
For all of us who longed to short Natural Gas on the way from literally $8 to $4 and never got a decent bounce...This wild bull is absolutely never wicking a trendline and then mooning, so here's your chance. Try not to die in the meantime lol.
Note
Massive Market Maker manipulation heading into Thursday's storage report.Imo not a dip to buy. For price to go and exceed $7.5 and make new highs really ought to require some accumulation to occur at lows, which did not occur under the July $5.325 pivot, the most important of all in the current price cycle.
Notably, the volatility is so strange that the 2x bear ETFs are actually up compared to when actual spot price was in the shaded area.
This is partially because they trade on a double percentage basis. If NG goes up 5 percent then the bear ETF loses 10%. This is significant because 10% is $2 at $20 and $1 at $10.
Note
I pondered on Friday whether or not there was grounds to go long on NG for a run into that $6.3 gap for month end. But I felt that the problem was this would end up drawing some kind of monthly pin bar:Which is a pattern that really hasn't been seen before.
Right now what I am thinking NG will do is run below the trendline early in November and probably play back towards the end of the month.
But like with all things it depends on price action.
Note
The above being said I also don't expect a particularly bearish monthly close either, because it already did that in June.Note
Well, there's the gap fill to finish month end. If my thesis on a monthly pinbar not being drawn were correct it would mean it'll dump nicely in the next 9 hours, lol.
Note
"It'll never form a monthly hammer. Look how far back it goes and there was never a monthly hammer like that," I said to myself on Friday while considering smushing "buy."But again, trendlines are astrology and this thing is never going to wick off a trend line and go to $18.
Note
Natural Gas more or less opened and died at NYSE open, which is really significant for the TSX and NYSE ETFsI think we see a rip to $6.5 to make the monthly high and then head under the October low.
Note
Natural Gas may not go $6.5 with how it's trading. That's a pretty big trading range it made and it already took out yesterday/November 1 high:If we do get a monster dump now, price action like this may indicate the end of November will actually be $6.5+ and a bullish continuation going into 2023.
Follow me on Twitter for more market-related banter.
Note
Natural Gas to $6.5 just a day after the Biden Admin announced it was done selling the SPR (I know, oil is different) and energy companies are pretty much done with earnings season.Canadian NG Bear ETF has traded double its high volume 2/5 days this week.
It matters because these volume signals have proven to me to be pretty reliable and also, as Canada, we're like the King of Natural Gas.
Note
Meet "Natural Gap"The question is does it seek to take October's high or is October's high where the resistance shall be found?
Note
I think they call this one the "shooting star," not that I believe in TA patterns. But it is significant after:a) Too easily bouncing off a trendline
b) Giantly bouncing
If/when it gets through $5.8, new lows are coming.
Note
Considering Natural Gas did not take out a low and instead only traded down into what I colloquially call this white box "cushion" in conjunction with $7.2 forming a double top, I don't think the bull run is finished.I think either in the box or slightly under $8 is where we're going, and I think $7.8 is more likely.
Note
Now that natural gas has rejected $6.3 and smashed up the lows, let's see if it's bullish enough to bounce and clear out the area around $6.4/With the pattern it drew, if it's not making more highs, it likely won't have more life than that.
Note
Bounce is happeningWait until natural gas storage data is released in an hour and we might get a repeat of September's big pop before the dump.
Note
People don't believe it until they see it. With how much time things take to play out and how much chopping around there is in the meantime, I frequently second guess myself too.Imo, natty won't see a 1-handle this time.
I have reservations about any bounces that don't involve an accumulation phase first, but Natty may not even see sub $2.50, and if it does, I don't think it will last.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.