Natural gas prices have collapsed from recent highs as investors continue to speculate on winter weather. Hereâs how to play the ongoing decline
â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â   My Secret Weapon on Natural Gas Dear Reader, This has been a very profitable week. Not only am I steering clear of this volatility and sitting in cash, but Iâve also been recommending that people drive natural gas prices into the ground. Historically, natural gas fails to find support above $6.00. But what weâve witnessed over the last month has been an epic collapse in prices. The so-called Widow Maker trade - a bet on spreads for the March and April period - has completely collapsed. Markets thought that we were going to have serious natural gas shortages heading into the end of the year. The markets are dumb. I remind people all the time that the United States has a virtually unlimited supply of natural gas, and the massive surge in prices earlier this year fueled a boom in production. Tack on new forecasts of a mild winter on the weather front, and youâre witnessing a mad dash for the exits. Weâre witnessing a huge collapse, and I wouldnât be surprised to see a number of hedge funds implode - if they havenât already. Now, some people will say - How could you forecast a collapse in natural gas prices. Well⦠how about this chart?   ProShares UltraShort Bloomberg Natural Gas (NYSE:KOLD) is a triple-bearish ETF on natural gas prices. Itâs already doubled in about a month, and I wouldnât be surprised to see it repeat history once again and get back to the $30s.   Natural gas prices would probably need to fall down to around $3.00 to get to that target, and Iâm projecting that direction. It would be fast and furious, and unexpected for so many people. If history is a guide, then weâll see about three months of weakness on natural gas prices, and plenty of leverage leave the market. If youâre going to trade KOLD, you need to be careful because of the leverage. But you could look out to May and speculate on some of the options on the fund and not have to risk too much capital. Otherwise, buy the fund, and just set a trailing stop around $10. You might not be as aggressive as I am, so consider shorting the United States 12 Month Natural Gas Fund LP (NYSE:UNL) instead. There isnât leverage in this fund, and itâs pretty directional. A return to about $8.00 is my target here. I donât see a rebound on the horizon for natural gas. Donât fool yourself into thinking that you can predict the weather. Focus instead on the price trend, which has been squarely downward for the last few weeks. On Momentum Momentum in the market is still negative. About 68% of stocks are trading under their 50-day moving average. More than 58% of stocks are under their 200-day moving average. I want to see two straight days of positive gains, and I want to ensure that the S&P 500 can sustain above the 4,590 level. Donât blindly dive into this market just yet. Cash remains your best friend. Enjoy your day, Garrett {NAME}
Chief Analyst, American Markets  Sponsored Message There's a MUCH better way to profit from the world's hottest companies... See, for the past 25 years, something called PRE-IPOs have absolutely crushed IPO returns. But they don't trade on the New York Stock Exchange... or the Nasdaq⦠or on any public market. There's just one way to get access to them. [Learn how, right here »]( © 2021 Godesburg Financial Publishing, Inc. DISCLAIMER: COMMUNICATIONS FROM GODESBURG FINANCIAL PUBLISHING (GFP) AND EMPLOYEES ARE FOR EDUCATIONAL AND INFORMATIONAL PURPOSES ONLY â NOT INVESTMENT ADVICE: GFP and all the services it offers are for educational and informational purposes only and should NOT be understood to be securities-related offers or solicitations. None of GFPâs communications should be considered or used as personalized investment advice. GFP recommends that you speak with a licensed professional before making any investment decision. RESULTS PRESENTED ARE NOT NECCESSARILY TYPICAL OR VERIFIED: GFP communications may include information regarding the historical trading performance of gurus in their services (all verified by a third party), as well as testimonials of non-employees depicting profitable investments and trades that are believed to be true based on the representations of the persons providing the testimonial of their own free will. Please be aware that the claims regarding investing or trading results of non-employees are not tracked by GFP nor can they be verified. As always, past performance is not necessarily indicative of future results. Therefore, results presented in this email should NOT be considered TYPICAL. Actual results can and will vary based on everything from experience, ability, risk mitigation practices, and market volatility... to the amount of money exposed in the investment or trade. Investing and trading are speculative and carry serious risk. You may lose some, all - or possibly more - than your original investment or trade. GODESBURG FINANCIAL PUBLISHING IS NOT AN INVESTMENT ADVISOR OR REGISTERED BROKER: GFP, including its owners and employees, are NOT registered as securities broker-dealers, brokers, or any sort of registered investment advisors with the U.S. Securities and Exchange Commission, any state securities regulatory authorities, or any self-regulatory organizations. GODESBURG FINANCIAL PUBLISHING EMPLOYEES MAY HOLD SECURITIES DISCUSSED: If a writer holds any securities in a communication, it will be disclosed along with the information on the potential investment or trade. GFP, its owners or employees, have not been - or ever will be - paid by the issuer of a security mentioned in our services or communications. GFP, its owners and employees are paid entirely or in part from commissions based on sales of their services to subscribers. For more information, please visit [our disclaimer page here.]( Sent to: {EMAIL} [Unsubscribe]( Godesburg Financial Publishing Inc., 251 Little Falls Drive, Wilmington, DE 19808, United States