re: BOIL has become predictable

LOL... Yesterday, I came back from lunch and it hit 4.09!

I've been lowering my cost basis on the dip. I'm down to about 3.83 overall now.

DGAZ is definitely designed to be a daily trade since volatility will erode your position due to compounding. However, when there is a steady move one way or the other, it can produce eye-popping gains/losses.

Basically, it is a 3x leveraged short fund. If the underlying index is up 1%, down 1%, then the fund is down 3% and then up 3%. The problem is that many people falsely assume you're back to even, when in fact you'd only have 99.91% of your original trade. So in short, you need to be on the right side if you're holding it over any extended period of time.

DGAZ closing at 3.82... I'll take it. Off to the long weekend. Warm baby warm!

Long UNG will disappear today? Movement pre market. Should I wait until Thursday, or close out this morning?

I wouldn't wait until Thursday........report will show below 250.........

I closed my Feb. UNG spread today. About 30 days in the trade, about 30%. I also closed out GDX and SLV. Also about 30 days, also about 30%.

The only UNG I have is now a short July position. It's getting warmer. I'd expect in July it might be all the way to above freezing. Propane prices are down, and they expect the supply to be up. Warming in the Midwest. Almost 50 here today. At some point real supply/demand fundamentals will return. I'm betting I'm on the correct side of the trade right now. Which is to say, shorter than short. Although, it bothers me to have to rely on an ETF for over 60 days. My trade will be a painful one to watch up until about May-June, due to the contracts owned and contracts that will be purchased by UNG.

quote:

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seems like stupid easy money to get short UNG summer

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I was thinking about this just yesterday. You can go triple short NG for about $3-4 share on an ETF, should at least hit $12, if not higher by the summer?


Is my logic flawed here, or is this a play that could make some money?

quote:

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I was thinking about this just yesterday. You can go triple short NG for about $3-4 share on an ETF, should at least hit $12, if not higher by the summer?


Is my logic flawed here, or is this a play that could make some money?

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lol welcome to 3 weeks ago.

Tomorrow the etf's and etn's will roll March contracts to April. The March will need to catch up w/ April, so it is possible you could see the short products behave strangely. Also, spot and March aren't caught up yet. The DGAZ play still possibly premature due to this in my estimation. My UNG puts were also probably premature, but I averaged down, and will do so again tomorrow or Wednesday when the average traders catch on to the backwardation and/or contango that is going to happen here shortly.

I'd expect tomorrow the short tracking funds to move the exact opposite direction most think they will. The long funds might track natty gas prices. Tomorrow or Weds. Then more volatility on Thursday. I haven't been watching spot or future prices closely.

I basically pussied out and bought long puts for July. I think I'll keep averaging down the cost, and let the chips fall where they fall on natty gas for now.