HoopyTrading 

It's gonna' be a cold winter.

Well this is an interesting change... all the more relevant since heating demand in the MidWest & Northeast dwarfs that of the Southwest. ie Cold in MW & NE far more significant than warm in SW.

NG Margin rates go up today from $2350 to $2550

Performance Bond Requirements: Natural Gas, NGLs and Petrochemicals Margins - [AUTOLINK]CME[/AUTOLINK] Group

My position now is that I have 1 future from about $2.90 that I wrote a covered call on at $3.20 that I'm just going to let expire. I was waiting for a pull back to move my sold puts up but it never came, so I just opened up two sold puts at $3 and $3.10 when /NG was $3.60. I took about a $1k loss on my last 16 delta sold call at the $3.60 strike and didn't convert it to a straddle. Instead I sold the $4.50 call. All in all I'm up quite a bit.

I find /NG good to play because 1 contract's move from $2 to $3 is only $10,000 dollars, which is manageable via writing calls or puts against it.

I've made a great return on selling puts in the high IV oil stocks this year: namely WPX, CHK, WLL, SDRL, WTI and then selling covered calls in them if assigned. Of all plays I like this method the best since one can really make good use of all of one's margin rather than setting a good bit aside for purer options methods like straddles and strangles.

I really like Agweb analysis of Grains with Market Rally by Chip Flory
They talk fundamentals, what the farmers should do.. what weather could do etc.. gives us a direction of what people are thinking


Is there something like that for Nat Gas?

Anyone know why how NG moves? I see sometimes moves at London open? Sometimes if big move up all the way into early afternoon est then it declines rest of the day? For CL people have 5min opening range from 9 - 9:05 est. I like 20 mins for NG. So should I have it 3am and 9 am for 20 mins? What pit close ? Does that even exist? Would appreciate thoughts from someone who understands NG and traded it a while thanks

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NG and CL were both NYMEX products and as such have very similar trading hours.
Pit hours for NG were the same as CL.
Globex trading hours are the same as CL (6pm to 5pm Eastern)
Current closing range is the same as CL, weighted average of all trades between 2:28 and 2:30 Eastern.

The biggest fundamental factor for NG is weather. So much so that most of the large energy traders have their own meteorologist's on staff. I am also lead to believe that certain algo/electronic heavy trading shops have it set up so that they process the raw data (which is available before the official forecasts) themselves and the algo's react accordingly. The moves during London hours could be related to the London Met Office releasing their forecasts. NG has some violent moves during the US morning session due to the weather models being released (GFS?).

SMCJB 

NG and CL were both NYMEX products and as such have very similar trading hours. Pit hours for NG were the same as CL. Globex trading hours are the same as CL (6pm to 5pm Eastern) Current closing range is the same as CL, weighted average of all trades between 2:28 and 2:30 Eastern. The biggest fundamental factor for NG is weather. So much so that most of the large energy traders have their own meteorologist's on staff. I am also lead to believe that certain algo/electronic heavy trading shops have it set up so that they process the raw data (which is available before the official forecasts) themselves and the algo's react accordingly. The moves during London hours could be related to the London Met Office releasing their forecasts. NG has some violent moves during the US morning session due to the weather models being released (GFS?).

So as a semi retail prop shop trader how do u trade NG? More with spreads and options based on fundamentals and weather? And don't do any intraday futures daytrades like in the scalping threads with tech indicators??



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jokertrader 

So as a semi retail prop shop trader how do u trade NG? More with spreads and options based on fundamentals and weather? And don't do any intraday futures daytrades like in the scalping threads with tech indicators??

Cross exchange arbitrage, cross product arbitrage, market making less liquid products, mean reversion butterflies and spreads. Generally high volume, low margin & very low risk.

After all these years and reading and reading and trying maybe there is something I can learn which is systematic and low risk. I'm starting to read up on spreads but even that has risk. Maybe I will get the right opportunity one day. I've read though autospreader not as profitable these days

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I can only learn what someone will teach me. In this business of shysters it's tough to make oneself vulnerable just because u want to learn. I would like to make this my second profession but am too late to work as an associate starting from scratch.Living near NYC shame if I cannot find the right mentor.Spreads and arbitrage are not something I can pick up on my own however I try unless I can dedicate the time in the right direction and with the right person. After many years unless I can find a low risk strategy not sustainable being a directional trader to get the confidence to increase size. Most who do it here have great money management, willing to take the stress and the luck. So not really sustainable or the best way to grow as a trader. Increasing size should come up as a boring step in a low risk method which has more than a small edge that tech indicators give u.





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