8 Sep

Natural Gas Could Regain the $3 Mark Next Week

WRITTEN BY Rabindra Samanta

Natural gas implied volatility

On September 7, 2017, natural gas’s (UNG) (BOIL) implied volatility was 32%—3.2% above its 15-day moving average.

Natural Gas Could Regain the $3 Mark Next Week

Natural gas’s implied volatility and prices usually move inversely. In the previous part, we saw a similar case with crude oil and its implied volatility.

In the last four trading sessions, natural gas’s implied volatility rose 0.2%, while natural gas October futures fell 1.9% during this period. On March 3, 2016, natural gas’s implied volatility rose to 53.8%. On the same day, natural gas prices fell to a 17-year low. From March 3, 2016, to September 7, 2017, natural gas prices have risen 81.7%, while the implied volatility has fallen 40.5%.

Next seven days

In the next seven days, natural gas October futures could close between $2.85 and $3.11 per MMBtu (million British thermal units). The price forecast is based on the following factors:

  • chance of prices closing within this range is 68%
  • prices are normally distributed
  • natural gas’s implied volatility at 32%
  • standard deviation is at one

If natural gas prices move above the $3 mark, it could have a positive impact on ETFs like the First Trust ISE-Revere Natural Gas ETF (FCG), the Direxion Daily Natural Gas Related Bear 3X ETF (GASX), and the Direxion Daily Natural Gas Related Bull 3X ETF (GASL).

Read US Natural Gas: Will It Maintain the $3 Mark? to learn more about natural gas prices.

Latest articles

This year, Pfizer (PFE) stock has fallen 0.34% and Bristol-Myers Squibb (BMY) stock has fallen 6.48%. Both companies are focused on strengthening their position in the high-growth oncology and immunology markets. Let's take a closer look at each.

Walt Disney’s (DIS) latest movie, Toy Story 4, has reportedly broken records in the opening weekend with $118 million in sales. However, the opening weekend collection was behind analysts’ expectations of at least $150 million in the first weekend.

24 Jun

Will Home Depot’s Upward Momentum to Continue?

WRITTEN BY Rajiv Nanjapla

As of June 21, Home Depot (HD) was trading at $209.39, which implies a rise of 9.7% since the announcement of its first-quarter earnings on May 21. Also, the company was trading at a premium of 32.4% from its 52-week low of $158.09 and a discount of 2.8% from its 52-week high of $215.43.

On June 21, Aurora Cannabis (ACB) made an announcement that indicated that it will move towards higher margin vape products. In addition, the company also believes concentrates and edibles will command higher margins. In anticipation of this development, the company announced the expansion of its facility to capitalize on growth related to these segments.

Shares of Mondelēz International (MDLZ) are scaling new heights thanks to its stellar gains so far this year. Mondelēz stock is up 38.0% on a YTD (year-to-date) basis, and it closed at $55.25—just a shade lower than its 52-week high of $55.71—on June 21.

24 Jun

How Long Will Facebook's Libra Fuel Bitcoin Rally?

WRITTEN BY Mayur Sontakke, CFA, FRM

Ever since the news about Facebook’s (FB) cryptocurrency project broke, Bitcoin has rallied on the hope that Facebook’s entry in the space will help make cryptocurrencies mainstream. Facebook’s cryptocurrency will be called Libra and will be governed by an association with 28 founding members across industries.