In our call review on 18th October FxWirePro: Keep riding the gas (call review), we reviewed our long call in natural gas and recommended to keep riding the bullish call, where we recommended a buy at $2.6 per MMBtu, with targets at $3.1, $3.7, $4.3, and $5.2. We don’t expect the natural gas to reach all these levels in this winter. While gas prices were dropping sharply during late October and early November, we recommended keep going and buying at dips.
If our readers had kept their cool, the trades have already been profitable and the recent price actions suggest that the gas might be heading for another buy breakout over the previous levels. You can see in the weekly chart above there have been very small or no shadows over the past weeks. Especially there have been no bottom shadows, which basically mean that the price opened at bottoms and closed at highs.
Once again, we would caution on one thing that the current inventory levels are quite high but the bets are on strong winter and lower levels of production. If the winter turns out to be a reasonably cold one, gas prices would be leaping fast.
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