Please continue posting NG stuff in here. Thanks.
On this Sun evening: only a modest downward open Sun night as Mike noted (~2%).
Thanks, Larry!
Previous thead:
https://www.marketforum.com/forum/topic/108738/
Just to carry over the last several posts here:
By metmike - Dec. 13, 2024, 5:59 p.m.
I started this post 4 hours ago then got interrupted and forgot about it.
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Yes, the total was -6 HDDs because of the end of the period that matters the most.
The cold spike during the 6-10 day period was actually +1 HDDs(a tad colder). However even if it was more than that, the market dialed in that brief cold spike and more previously(and yesterdays VERY bullish EIA). Its now focused on trading the return to the much milder weather after it ends.
We are closing with a technical AND weather pattern that strongly favors a gap lower on the open Sunday Night.
The models will need to change to colder for that to NOT happen.
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By metmike - Dec. 15, 2024, 5:30 p.m.
Still expecting the gap lower open tonight.
Question is…….how big will it be???
That would be a downside break away very bearish technical formation.
to negate that, we need the models to turn sharply colder late in the 2 week period.
Some of the solutions are trying to do that already but it’s not in time to save NG on the open.
and the real mild solutions are the majority which will put a great deal of downside pressure on NG. Maybe to $3 in short order.
The EIA storage report should be a tad bullsh but not nearly as robust as this last bullish surprise. And the market dialed that in over a week ago BEFORE it happened.
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By metmike - Dec. 15, 2024, 6:02 p.m.
We got a modest gap lower of around -$450/contract.
Now what happens?
depends on weather models. Continuing mild and NG is toast.
getting colder again and Ng filling this gap negates this formation and turns it into a gap and crap BULLISH indicator. However, the reliability would be extremely low because we are only subject to the same volatility of the weather models that have low skill in predicting a pattern like this for 2 weeks out.
honestly, if I had been short over the weekend, I would have covered already because we’re getting enough initial buying to close some of the gap instead of it providing more selling incentive That would have added to initial losses.
The weather models will decide where we go the rest of the week!
Temps for this Thursday's EIA report at 9:30pm Central. Maybe a tad bullish, unlike the bullish surprise last week.
https://www.cpc.ncep.noaa.gov/products/tanal/temp_analyses.php
0Z European ensemble was a whopping -14 HDDs so down we go(went)!
The GEFS was colder mid period but with a milder finish.
+7 HDDs for the 0z.
With the gap lower last evening not being filled p, it remains as a downside break away gap signature.and VERY bearish.
Added 10am: The 6z GEFS was -7 HDDs the previous colder 0z run and back to the 18z run but the market bottomed after that and came all the way back to make a new high by a few ticks at the bottom of the gap but could not fill the entire gap, as sellers aggressively stepped in. So a SMALL part of the gap remains open.
I was surprised at last evenings strength after the lower open(not following thru selling) but REALLY surprised at how we came back to the bottom of the gap after the mega bearish 0z EE.
Considering how well NG held up after the much milder 0z EE last night, I suspect colder models will fill the gap.
12z GEFS was the same as the very mild 6z and -9 HDDs vs the colder 0z. So bearish!
The 12z Canadian model is a bit bullish in my view. These are the maps at 384h hours....end of period.
https://weather.gc.ca/ensemble/charts_e.html?Hour=384&Day=0&RunTime=12&Type=gz
The Last 12z EE was another -2.6 HDDs VS the already mega bearish, previous 0z run.
Im surprised we are still near the opening price from Sunday Night! The gap has NOT been closed completely however, so it’s still a downside breakaway signature/formation on the price charts. We are also just above the mid point of the range for todays daily trading bar.
Hey Mike, I’m educatedly guessing NG got a 1% pop late in the 0Z EE due to:
1) A somewhat notable overall increase in HDD vs 12Z per me eyeballs. Week 1 appeared fairly unchanged with probably a modest drop. But week 2 clearly to me was notably colder due mainly to late week 2. How much did the complete run’s HDDs increase by vs 12Z? Or am I mistaken? What say you?
2) The end, itself, looked bullish with a reforming +PNA.
You are correct, Larry. The 0z EE was slightly warmer early in the period and slightly colder at the end. Overall HDDs compared to the 12z run were almost the same though. This DID give ng a bit of strength at the time, which settled back. The 0z GEFS did something similar.
Then, just before 6am NG had a big spike higher that filled the gap(in the midst of the 6z GEFS coming out milder at the end-made no sense) and took out a ton of buy stops, followed by a sustained selling surge that took us down $1,000/contract in an hour and now, just before 8am we are close to the lows for the week.
0s EE in purple on the left. 12z EE in tan.
Last 6z GEFS in purple below. Colder 0z (at the end) GEFS in tan.
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Indices and Anomalies at the end of 2 weeks:
Thanks, Mike.
So, pop wted US HDDs per last 4 GEFS: absolute blowtorch most days through Dec 31st with only ~13/day Dec 27-9, which amazingly is a mere ~50% of normal to barely above that! The 13 is the normal for Nov 13th, a full 1.5 months earlier! So, if this prog is correct, we’ll be only at mid Nov normals for a few days late in Dec just before the expected end of month cooldown! I bet that is at least near a record low for pop wted US HDD then.
Do you have a source for what the record low US pop wted HDD are per each calendar day? I should note that these do run a little lower than Maxar’s, whose normals in late Dec are ~29 rather than 25 if I’m recalling correctly. But regardless, in relation to Maxar’s normals, I’m assuming that the GEFS prog is near their mid-Nov normals, too. So, perhaps Maxar has GEFS late Dec daily HDD prog at, say, 15. That would be my educated guess.
Thanks met and wx for this continuing conversation about NG . What is " pop wted US HDDs "? What is HDD prog?
Cutworm said:
What is " pop wted US HDDs "? What is HDD prog?
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Hey Cutworm,
1. US population weighted heating degree days. These are more heavily weighted by the degree days of the E US due to higher population density and thus more heating energy usage there.
2. Prog is short for prognosis or forecast. I’m referring to the model’s forecasted HDD.
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After seeing how low the progged HDD are, it really is surprising how well NG is holding up.
thanks just trying to learn about this and you guys are light years ahead of me.
YW, cutworm.
To all: My Maxar contact just emailed me this chart, which shows that the GEFS is predicting US pop wted HDD to be near or at record lows today as well as Dec 26-7 based on record dailies that go back to 1950:
that helps my understanding a lot
The last 15 minutes saw a >2% rise clearly due to a colder 12Z EE vs 0Z for 12/27-30 despite the temperatures remaining mainly warmer than normal. Helping it is a robust +PNA late.
Larry,
The 12z EE hasn't even started to come out yet.
The 12z GEFS and 12z Canadian model were not much different.
The 12z operational E model is over halfway out and similar to the previous one.
The +PNA has been the same feature all week.
12Z EE has been fully out on WxBell and mostly out on Pivotal.
What’s your source? TrueWx? If so, why are they so slow today? Are they always this slow?
It has to be the colder late EE. What else would have caused it to rise so sharply the last 30 minutes?
Wow, I can’t believe they would be this slow.
yes, this is always the time it comes,out. Time to get a new source!!
what’s the link to yours, Larry!
That’s weird!! Back when I was a TruWx subscriber, they came out about as fast as Maxar DD! Otherwise I wouldn’t have paid for it. What time does TruWx EE usually finish? What about GEFS? I’m confused. Something doesn’t seem right.
Pivotal: free https://www.pivotalweather.com/model.php?m=epsens
Even faster is WxBell but I can’t provide a link because it is pay. But you can get subscription for pretty low price.
Edit: NG up a whopping 17 cents (5+ %) last 70 minutes! Why so much? Colder late EE shouldn’t have been enough and most of that run still has well BN HDDs, regardless!
Was at chess practice at 1 of my 5 schools the last couple of hours.
Larry,
I'm shocked and grateful at the same time.
Like you, I always assumed they were the fastest. It explains some market reactions recently that suggested traders getting the EE earlier than before.
So apparently the EE is coming out earlier than before by a large amount of time, correct?
It's ok for you to provide the Weather Bell link here if you want.
Regardless, I'm going with them if they are the fastest.
If you hadn't made me aware of this, I would have been trading ng with a huge disadvantage for a long time!!
This was the 12z EE HDDs. +2.6 vs the previous 0z run, all at the very end of the period. I would have never guessed the reaction would be this powerful to the price. However, the market was refusing to sell off earlier on some pretty mild forecasts(acting better than expected as you also noted).
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Who could have imagined the HDDs below would result in a +$2,500/contract reversal from down sharply to up sharply. It started at ~11:30 am. It wasn't just knee jerk. The buying continued strong for several hours.
What an insane reversal below on the 1 day chart!
https://tradingeconomics.com/commodity/natural-gas
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1. 850 temps at 360 hours from 0z EE. -2 Deg. C at Chicago.
2. 850 temps at 360 hours from last 12z EE, 12 hours later, -6 Deg. C at Chicago.
Hey Mike,
1. WxBell: https://www.weatherbell.com
2. How much did EE HDD rise? This huge upward reaction seems way out of line from just a few extra HDD late and that with still an overall very warm run. **Edit: never mind as I see you just posted it went up a mere 2.6.
3. Maybe something to do with increased LNG exports?? Always a wildcard nowadays.
4. I’m writing TruWx to see what they tell me about EE DD timing. I was actually considering becoming a subscriber again due to it being pretty cheap, but this could prevent that.
*Edit: LMAO, I emailed the CEO of the wrong company. I emailed Tru Weather instead of True Weather. Ooops. I didn’t know they both existed with such similar names!
This was the last 500 mb map of this latest 18z GEFS. This is STILL BEARISH! Something else had to be causing the huge rally, even though the 12z EE seems to have triggered the start of the buying surge.
Did NG just rise 2 cents on colder late Euro op?
My service just started the European model.
larry, if you don’t mind sharing and to save me a ton of time that I’m lacking right now….what service are subscribing to at weather bell?
the GEFS was WARMER for the 2nd run in a row -2 HDDs on both runs.
Hey Mike,
“Premium” service. You’ll like the change maps.
By the way, EE almost finished and my eyeball based guess is that HDDs are fairly similar to 0Z. But the end is very slightly less bullish looking than 12Z although still has a bullish look. GEFS is ugly looking at end. CDN ens is pretty looking (bullish).
0z EE was -3.4 HDDS compared to the previous 12z run.
This means lower than the one 24 hours ago, when nat gas tanked. However as you mentioned, it’s the end of the period that the market is trading because that’s the one giving us the best clue about the month of January.
EE and Canadian models suggest a much colder trend in early January. GEFS says the complete opposite.
The colder versions would make it more exciting and what I would enjoy more (although I’m running a big chess tournamemtm on Jan 11th and a winter storm would reek havoc here in Evansville-result in rescheduling)
i can tell how much more you like the colder forecasts too.
My preference is not impacting my forecast, which is going to flip flop with the models, though leaning towards the cold january right now.
it will try to anticipate what the market will think.
yesterday, that was obliterated by the massive reversal that I would have never imagined from the amount of change on the weather maps.
if the GEFS is right, January could start out VERY MILD in many Places.
air masses coming from Canada would be very mild.
I’m still thinking NG is likely trading something else bullish that has nothing to do with wx. It is up way too much for that not to be the case imho. The wx being significantly more bullish than it was recently is highly questionable imho. If I had been trading it I’m confident I would have missed most, if not all, of this entire big rise since yesterday midday. I’m wild guessing it has something to do with LNG, my “favorite” factor lol.
NG being almost back to highs of the year (within 15 cents) makes no sense just based on wx. It is up nearly 10% from yesterday’s lows for goodness sakes! Sometimes, especially over the last few years as we know, it trades mainly nonwx factors like LNG.
Yes, I definitely prefer it be cold in winter here in the SE US in this warming world. Heat and humidity is increasing in dominance, which I don’t like.
Agree, Larry!
The other models are not like this but this last 6z GEFS is very bearish. It even has an upper level ridge building in the Southeast. The very weak ridge-west/trough-east couplet has a mostly, mild zonal flow component. No way a map like this justifies the huge move up yesterday and ng ADDING to the gains today.
It might be wrong, of course but something else must be up, like you said.
Larry,
Regarding LNG exports..........this bullish export demand study below, came out yesterday right when ng started it huge climb from SUSTAINED buying that lasted hours. As we've noted in the past, when its a reaction to 1 particular weather model(EE slightly colder at the end on 12z run), the move is extremely spikey. That was NOT the case yesterday.
https://tradingeconomics.com/commodity/natural-gas
December, 17 2024
Washington, D.C. – The U.S. Department of Energy (DOE) today released an updated study of U.S. liquefied natural gas (LNG) exports. DOE has been given the responsibility by Congress under the Natural Gas Act to evaluate the public interest of proposed exports to countries with which the United States does not have a Free Trade Agreement.
The U.S. liquefied natural gas export sector has experienced transformative and unprecedented growth in just a decade, with the first LNG exports from the lower-48 states commencing in 2016. DOE has authorized 48 billion cubic feet per day (Bcf/d) of natural gas for export, or nearly half of current domestic production.
Of this 48 Bcf/day in total authorized exports, 14 Bcf/d of associated capacity is now operating, making the U.S. the largest exporter of LNG in the world. Another 12 Bcf/d is under construction and expected to double present export volumes by 2030, at which time the U.S. will remain the top exporter, exceeding other countries by roughly 40 percent based on announced expansions. And a further 22 Bcf/d of capacity exports has been approved by DOE, but has not secured a final investment decision to begin construction.
Given these robust export commitments already made, and before considering additional applications that would take authorized U.S. natural gas exports beyond levels previously evaluated, DOE leadership recognized the need for a comprehensive update to ensure the most comprehensive and up-to-date analysis possible of market, economic, national security, and environmental considerations of different potential volumes of U.S. LNG exports.