Beginning in 2000 through the middle of this decade, natural gas was financialized through commodity ETFs and prop trading desks at hedge funds and banks. This influence subsided just a few years ago thanks to Volcker and other regulations greatly reducing the ability of Wall Street banks to accumulate delta risk. Since then, natural gas prices have resumed a seasonal trend of price spikes in the 4th quarter similar to how the commodity traded in the 1990s.
After a breakout to multiyear highs in mid November 2018, NG has pulled back below $3.00 typical of the seasonal pattern observed in recent years. While trading near multi-month lows, NG has yet to show confirmation of a short-term bottom though its decline has halted over the past 4 days.
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