Navigating the Energy Markets: Short-Term Bullish on Henry Hub Natural Gas Amidst Other Energy Downtrends

I think that energy prices are in the latter part of the larger mean reversion that I have been waiting to play out.

While Crude Oil, Gasoline, Diesel and Heating Oil prices look like having more downside and are confirming downward trends, my posture, at this end of the pendulum is being a buyer rather than ‘shorting’.

On a daily trading basis, Henry Hub Natural Gas is my nearest buying candidate.

Following today’s 5% decline (currently trading at $2.57), whether it tickles the $2.47 region is myopic. It has fully retraced the 45% advance which commenced in September 2023 along with ‘backing and filling’ a large gap.

Although, this may be a short-term trade where I scalp some returns, while I keep in mind that $2.10 could be seen if certain trend indicators exhibit strength.

But I am in a broader territory where I’m a longer-term accumulator.

December 7, 2023

by Rob Zdravevski

rob@karriasset.com.au