Natural gas Futures completely tanked on Tuesday dropping around 10%. The technical picture is looking grim as it appears that natural gas is rejecting its previous highs. There is also was a major divergence between the price of Nat. Gas Futures and both MACD and RSI on the weekly candles. That is a bearish indication. This probably added to the downward momentum of todays sell-off. You can see the divergence in the charts directly below.
warrior-sailormoon : I am holding long. May i know what does that mean by “cover the long position “
Enlighten me pls. Thanks SpyderCall
warrior-sailormoon : Looking forward tomorrow G7 meeting (Thursday or Friday) for price cap n Russia’s action to this matter and OPEC plus immediate action on the oil price crash. I think most of the solutions will resurface once price cap is being discussed
SpyderCall OP warrior-sailormoon : It can be a lot to explain. But it is a strategy using options. Basically if you are holding a long position and you don’t want to sell it when the price starts dropping then you would cover your long position by selling and options call contract. This way you can retain the gains until the price starts moving up again. When the price starts to uptrend again then you would buy back the call that you sold. That is basically how it works.
SpyderCall OP warrior-sailormoon : Possibly. I can see that happening
warrior-sailormoon : Holding super long almost to the max but mid term play (super long just to lower down my risk) Either i DCA down my long or cut lose and enter again but my gut tells me to hold for awhile more as OPEC can’t be sitting looking the oil crash as they’d mentioned on Monday’s meeting and todays news also reiterated a simple tweak will be made to keep oil price to its fundamental
warrior-sailormoon : Actually I’m started to freak out but try to stay as calm as cucumber
BeBlessed : Will the movement of natural gas (currently bearish) affect the movement of indices?
warrior-sailormoon SpyderCall OP : Good idea. Sell first and do nothing while waiting for the price up again and enter at the same point where i left.
SpyderCall OP warrior-sailormoon : It’s can be difficult to execute the strategy perfectly. But that is how all of the pro traders do it
SpyderCall OP BeBlessed : Not so much the major indIces. But definitely the sector ETF’s associated with natural gas. also oil seems to be dropping right now so watch the ETFs for crude oil as well
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