Natural Gas Newsletter

8/9/2019 Natural Gas Newsletter

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JULY 2010 GAS/S&P Newsletter

PROVIDED BYABCSOFGAS.BLOGSPOT.COM

Vol. #1 Disclaimer: All comments made by ABC OF GAS are for educational and informational purposes only and

should not be construed as investment advice regarding the purchase or sale of securities, or any other financialinstrument of any kind. Please consult with your financial advisor before making an investment decision regarding

any securities mentioned herein. The views, opinions and analysis expressed are strictly those of the individualauthor, unless stated iotherwse. ABCS OF GAS assumes no responsibility for your trading and investment results.

All information on the website was obtained from sources believed to be reliable, but we do not warrant itscompleteness or accuracy, or warrant any results from the use of the information. ABC OF GAS and affiliated

individuals may have a position or effect transactions in the securities herein and or otherwise employ tradingstrategies that may be consistent or inconsistent with the provided strategies. Trading of any type involves a veryhigh degree of risk. Past results are not indicative of future results. By viewing and using my trading strategies, I,

Zeeshan Maqsood will not be held responsible for any money you lose. Always have due diligence when youbuy/sell. Please do not follow what I am doing, and when you lose money blame it on me. This newsletter is

educational solely. Use your head too! Good luck.



NATURAL GAS CHARTS - SUMMARY

-YEARLY CHARTAs shown in slide 3, we believe natural gas to be a long-term uptrend and we would not be surprised to see high $10s by

the mid-decade; however, we believe that doing DD and looking for companies heavily invested in gas productionwill prosper and will have higher returns than the S&P. In the long-term, going long HNU.TO might not make youmoney because of the decay and contango effect of these leveraged instruments.

-MONTHLY ANALYSISWe are stuck in a trading range for July-August 2010. We are likely to re-test $5.20 again this fall but only because future

spot prices reflect this price increase. I would play this one out SHORT and SHORT any overextensions above $5.20or future spot prices. Remember.. Getting a good entry point is what T/A is all about..

-DAILY CHARTSDaily charts are purely noise for commodities.



MONTHLY ANALYSIS

ON THE 15-YEAR MONTHLY CHARTS OF NATURAL GAS, THE YELLOW LINE SUGGESTS CONTINUOUS UPWARDS MOMENTUM IN NATURAL

GAS TO COME. WE DO NOT FORECAST A RE-TEST OF THE BOTTOM MADE IN THE FALL OF 2009. LONG-TERM RESISTANCE LIES AT $6.00 AND

WE BELIEVE PRICES WILL REACH THOSE LEVELS IN WINTER 2011. BEING LONG STOCKS IN THE GAS INDUSTRY WOULD BE A WISE

INVESTMENT PLAN GIVEN THAT OIL PRODUCTION IS LIKELY TO PEAK IN THE NEXT 5-10 YEARS. UNFORTUNATELY THERE IS NOT AN

INSTRUMENT THAT EXISTS THAT ALLOWS ONE TO GO LONG NATURAL GAS WITHOUT LOSING OUT ON DECAY/CONTANGO.



•NATURAL GAS STORAGE NUMBERS

SOURCE: BLOOMBERG



Weekly Analysis:

The weekly chart of natural gas is very telling of what’s to come. Pay attention to the 2 teal lines. I believe a very clearbreakout is about to be generated in the gas markets. The currentpattern is a symmetrical triangle which suggests indecision between buyers/sellers. As winter approaches the more likely direction of the break-out is up. Future spot prices suggests usto trade in the lower $5 range. I would keep shorting natural gas until fall 2010 , only because if you are wrong in your trade, you can re-capture your $ through decay (this implies thatyou short hnu.to/hnd.toand not go long these instruments.



S&P 500 CHARTS - SUMMARY

-YEARLY CHARTThere is a huge buy signal generated by the TRIX. The TRIX is one of the LAST indicators to turn bullish and therefore

gives the fewest whipsaws. NOW is the time to buy.

The Trade:

Long the US market [maybe gas companies are cheaper now?, keeping adequate stops in-case we do double dip. ]

-WEEKLY CHARTDouble dip, depression… these are the words said by the majority of the blogosphere. I’m taking the opposite direction

to them. The bears believe that the bulls are done because 1) 1040 broke, 2) MAs showing a death cross, 3)Fundamentals support technical's..

The weekly chart shows that it is very unlikely for us to continue dipping down much further.

Please view the chart to see the studies that I applied and why I am bullish. I do not think we go to new highs just yet,but at least go back to 1100 on the S&P.. Q2 earnings can be that catalyst.



20-year S&P ANALYSIS.. WHERE ARE WE GOING?



WEEKLY 20-YEAR S&P CHART

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