So looking at the past decade of 2010 - 2020 Natural Gas had its Highs in 2010, 2014 and 2018 and Lows in 2012, 2016 and 2020 indicating a 2 year cycle. During this time period NG had a trading range ranging from basically 1.50 on the Low side to 6 USD on the High side which I consider the extreme parameters with in which the NG Contract operates for the most part, the median being 3.75 USD.
The price of NG seems to reach its highs in between the Winter period of every year for the past decade with peaks around the months of October to February and the exception of November 2015 and November 2017 most likely due to the commodity cycle crash earlier in the 2014 -2015 period.
Now from this October to February highs the price decreases around about 35% for a period of between 90 - 120 days up unit around March –April. The reason most likely for this is due to the switch in demand for winter to summer gas. The exception seems to be the year 2016 but once again I believe it can be attributed to the commodity cycle crash mentioned before.
In 2 cases the price of NG decline by 65% over a 2 year period from the High side to the Low side and in one case it decline by 72% over a 2 year period.
So since I have done this at least once before and will do so again having made 100% profit during October - November 2021 NG Crash I will do so again considering the fact that spring is near and the major force being the weather seems to be to my advantage.
I do believe NG will go lower between the March/April contract 2022 but not reach below 3.75 USD after which it will decline by around about 33% next two consecutive weeks ahead. Based upon this information I have already established my position at 4.90 USD and will continue SHORT NG up until end of March 2022 by using a ETF Denominated in Pound sterling to take advantage of potential interest rate hikes in the future and using the technological advantage of SHORT 3 X LEVERAGE for Natural Gas with a expected return of at least 105% and price target of around 3.75 USD. Once the price target has been established or after March 2022 – April 2022 I will re-analyse the situation during the time period to determine continue SHORT or not.
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