Opinions
Don Vialoux
1stTr ISE Natural Gas E.T.F.
FCG-N
PAST TOP PICK
Oct 01, 2014
Stock price when the opinion was issued
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(A Top Pick Sept 4/15. Down 8.67%.) Seasonality did come into the sector right around the end of August, and normally goes right through until the 3rd week in December. However, this year we have had warmer than average weather in the eastern part of Canada and the US, and natural gas prices have come down quite significantly. The sector right now seems to be trying to bottom out, but the technicals are not there right now. There are lots of better opportunities elsewhere, so if you own, Sell.
Recently, this has been forming a base pattern, which is typically of what would happen around the 3rd week of September and moving higher until the middle of December. Natural gas has been forming a nice little base pattern, and a couple of days ago moved above that very briefly. Usually, the stocks themselves, don’t move that quickly. We are not quite at the 3rd week in September, so currently the securities are forming a nice base pattern. Natural gas inventories in the US are right around where they should be on a 5-year basis, however, there are 2 hurricanes going into the Gulf, which is the largest natural gas producing area in the US. Because of this, in the next few weeks, natural gas inventories will not be building quite so much.
(Top Pick Aug 22/14, Down 5.04%) Nat Gas is up 4-5% and yet gassy stocks are down 5%. Make sure when you make your calls that you go into the right products. We are still in a period of seasonal strength, but need at least two of the three technicals to be positive.