If you could make only one trade in 2020, consider this one…
Natural Gas futures have traded under 2.00 only four times in the last 20 years. And, each of those four times nat gas rallied strongly in the following months. Also, note that NG is approaching a bullish seasonal timeframe (late Jan/early Feb). NG prices are now under 2.00 for only the fifth time in the above-mentioned time frame.
Recommend consideration to:
- Go long NG futures
- Buy NG call options
- Buy UGAZ 3x ETF (In the last four months UGAZ has declined from over $225 to only $50!)
- Buy UNG, which is down 34% for the year.
My minimum upside target: 4.00 – 5.00. Be patient with this trade. There are always reasons when NG trades below 2.00. Allow time for the fundamentals to change. Also, the geo/political risks do not seem factored into current prices. Actions by one mad man could quickly spike NG prices.