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sebastien-bischeri

Nymex Natural Gas: How to Trade In Conflict-Marked Conditions?

March 2, 2022, 9:19 AM Sebastien Bischeri , Oil Trading Strategist

Please note that due to market volatility, some of the key levels may have already been reached and scenarios played out.

Trading positions 

  • Natural Gas [NGJ22]
    Long around the $ 4.490-4.550 support area (yellow band) with a stop at 4.340 and targets at 4.745 and 4.860.
  • RBOB Gasoline [RBJ22]
    No new position justified on a risk/reward point of view.
  • Brent Crude Oil [BRNJ22]
    Long around the $ 93.36-95.01 support area (yellow band) with a stop at 89.92 and targets at 99.50 and 101.99.
  • WTI Crude Oil [CLJ22]
    Long around the $ 89.54-90.45 support area (yellow band) with a stop at 87.06 and targets at 93.83, 95.64 and 99.10.

Chart

Description automatically generated

Henry Hub Natural Gas (NGJ22) Futures (April contract, daily chart)

Graphical user interface, chart, histogram

Description automatically generated with medium confidence Henry Hub Natural Gas (NGJ22) Futures (April contract, 4H chart)

Regarding risk management, it is always best to define your strategy according to your own risk profile. For some guidance on trade management, read one of my articles on that topic.

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Given the choppy fundamentals of these energy markets, today’s trade projection is based on a purely volume profile analysis, thus getting ready to get long (as usual in a bullish market).

In the current market conditions, the trade could be initiated around both the previous and current months’ Volume Point of Control (VPoC), that is to say, around 4.490-4.550 (yellow band), with a stop loss to be located just below the previous swing low (4.340) and targets at 4.745 and 4.860. Given the international tensions, lifting European gas (TTF benchmark) prices back up to October ’21 levels, the participants may try to auction with higher bids on the US benchmark.

In addition to the previously mentioned targets, a third one could be located between 5.9000 and the psychological $5.000 mark.

That’s all folks for today – happy trading!

As always, we’ll keep you, our subscribers well informed.

Thank you.

Sebastien Bischeri
Oil & Gas Trading Strategist

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