Talk about getting out by the hair on your chinny chin chin, average price of $7.529, got out at $7.535. I'm going to be a cheapskate this time and wait for the 7.30's. Comanche, any particular prices look appealing for re-entry to you? Crude rebounded to $55 on some light volume, I think we're due for some crude consolidation, I sold at $55
Jan 14, 2004 Jan 15, 2004 Jan 15, 2004 70.0000 33.0000 47.1014 63,100 18 11 (hopefully that shows properly) - thats transco z6 NY record price, i believe.. $70/mcf... surpassed anything in Katrina.
Still sittin on these crude contracts. Natural gas is in the 7.30's Report tomorrow would be supportive of natural gas, but perhaps we've gone too far too fast? Those transco numbers are insane, a high of $30 for the day?
comanche: what makes z6 and the entire NY so volatile? Are those hubs not in proximity to full enough storage facilities? I think expectations for this week's report is 160bcf and next week is 180bcf. I imagine weather forecasting and technicals would run this market more than that report, since those wild cash prices look to confirm a weather picture (worsening).
We'll likely eliminate the year-over-year surplus, but if I recall, last year was a particularly bad year (low withdrawals), so I don't think that is saying much. Versus the 5 year average we have a 490 BCF surplus; versus last year we have a 360 BCF surplus. If we average 110 BCF draws through March 31st we will be flat year over year, we have to average 130 BCF draws to be flat versus the five year average. If we have -160 next week and -180 the week after we will have a surplus of 190 BCF year over year, and 320 BCF versus the five year average. Thoughts? With spikes to $30 mmBTU it must be very valuable to have a natural gas storage facility near that transco point. If I recall, Ken Deffeyes (of Hubbert's Peak fame) discovered the largest NY gas wells in western NY in the 1980's, I wonder if they're being converted to storage wells now that they've been pumped dry. Update: Actually if I have my spreadsheet set up correctly: last week a withdrawal of -175 BCF, this week was as cold as last week, lets say -155 BCF to be conservative for this week, and the next two weeks are predicted to be as cold if not colder so being conservative -155 BCF withdrawals again, then compared to last year's storage numbers that results in a decrease in the surplus of 331 BCF, essentially eliminating it, with 6 weeks of winter left to go. El Nino has collapsed from +1.3C to +0.6C in three weeks time, and is modeled to go to +0.2C by mid-February. I wouldn't buy ng just yet, crude looks perched for an overnight profit-taking run down which should drag natural gas into the lower 7.20's. Someone is going to make a killing and someone is going to be killed over the next two weeks. I'm excited...
Still sitting on my hands. Comanche, any info as to whats happening? Looks like buy on the rumor sell on the news. I still expect pre-weekend short covering though so I will likely re-enter before tomorrow noon time,
funny -- i made a similar trade this morning (avging down price) -- bought march 7.065, stop 7.035 ... sold to a avg price target (on the outright march)
Sorry guys, went out last night and been buried today, had no time to write earlier. Gave some back today as I held my length from my 7.290 avg buy from last night Feb and didn't stop out until we broke the 6.920 support area, but taken in stride as the run has been awesome so far. Looking at the action, I believe today was massive short fund intervention to protect the larger short they carry as i saw a constant 56 lot offer every penny ALL DAY LONG (56 lots = 2 contracts a day for feb). After market talk to some buddies have more die hard bears turning now as they are starting to see the whole weather/storage situation I have been hammering on them with. For me, nothing has changed as far as my end game expectations from here, I fully expect a full on short squeeze within the next week or so with a massive OI in march, most of which is spec paper short the march leg of the march/april spread. I still believe that spread is going to hurt another fund very badly before it is all over. The weather continues to be bullish for the next several weeks, with the coldest temps seen in many years coming next week into a wide area of the US and most importantly the population dense consuming regions of the upper midwest and the NE. Todays storage withdrawal was -179, a little more bullish than expectations, as the market rallied post report, the size came in on the offer and was relentless on the selloff all day. This is what i percieve to be the last stand of this particular fund before the pukings begin. Next weeks storage to me looks like a minimum of -220 based on my weather modeling, followed by a -250/-275 (275 would beat the all time record set in jan of 1997 of -260). What a reversal, we had a yoy surplus of +404 BCF and in 4 weeks will have gone into a yoy deficit with another 40% of winter withdrawals to go! We won't run out of gas no, but going into deficit IS significant and turns people bullish because of several reasons. First, El Nino is going to be history in another month or so and is barely even classifiable now anyway and that will lead to a much more active Atlantic hurricane basin this year compared to last years benign season thus potentially causing supply disruptions. Second, we saw for the first time last year 2 mid summer storage withdrawals for the first time in history due to summer heat. Well, yoy electricity demand has grown by last count +2.7% and will lead to more peaker gas units being utilized this summer which will reduce the amount of gas we will be able to inject this season making it difficult to get to the comfort level of at least 3.3 TCF before next winter. The forward curve should remain well supported down heremaking the risk/reward of being short down at these levels an upside down proposal. I know the volatility can hurt bad in this market, but find a way of participating in this epic battle of bull/bear we are fighting at the moment as I believe the bulls will win and win BIG! Safest and possibly most lucrative way to play is still in the H/J spread, buying the march leg. Good luck.
wow. 220/275?? thats bullish. my bentek #s are only calling for something quite a bit more benign next week (185 or so). it looks like you were anticipating -.30 on the spread before (correlating to .50/outright = .10/spread movement). Has your outlook on the spread changed? I'm going to be scaling in and out of this position (outright march long, and mar long/apr short spread) as it goes against. I wouldn't be surprised to see the bullish move on the spread on a sunday gap, though.