22 Sep

Where Natural Gas Prices Could Go Next Week

WRITTEN BY Rabindra Samanta

Natural gas implied volatility

On September 21, 2017, natural gas’s implied volatility was 35.1%, or 5.1% above the 15-day average.

Where Natural Gas Prices Could Go Next Week

Usually, natural gas (UNG) (BOIL) prices and implied volatility move inversely. For example, on March 3, 2016, implied volatility in natural gas rose to 53.8%, and on that day, natural gas active futures settled at a 17-year low.

Since then, its implied volatility has fallen 34.8%, while natural gas futures have risen 79.7%. In the trailing week, its implied volatility rose 1.4%, while natural gas prices fell 4%.

Price forecast

There’s a 68% chance that natural gas active futures could close between $2.81 and $3.09 per MMBtu (million British thermal units) in the next seven days. This calculation is based on the assumption that prices are normally distributed, using a standard deviation of one and an implied volatility of 35.1%.

On September 21, 2017, natural gas (UNG) October futures closed at $2.95 per MMBtu (million British thermal units). There’s a bigger range toward the downside, and given recent bearish momentum, a close below $3 is more likely.

If natural gas prices remain below the $3 mark, then it could be a bearish catalyst for 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).

For more analysis of natural gas prices, check out Market Realist’s series Are Natural Gas Prices Set to Rally?

Latest articles

Shares of the J.M. Smucker Company (SJM) are up 29.8% year-to-date as of June 24 and have outperformed the broader markets. The company's acquisition of Ainsworth Pet Nutrition and its focus on high-growth categories via divestitures have supported its stock so far this year.

On June 25, General Motors (GM), America’s largest auto company, announced its plan to invest $20 million into its Arlington Assembly plant in Texas, according to Reuters. With the new investment, the company aims to upgrade its equipment before launching its full-size SUVs.

Shares of high-growth technology company ServiceNow (NOW) have gained close to 16.0% since April 2019. It's gained over 60.0% since the start of 2019. It also had an encouraging run in 2018, when it gained 32.0% in market value.

25 Jun

Ford to Announce Q2 US Sales on July 3: What to Expect

WRITTEN BY Jitendra Parashar

Earlier today, Ford (F) said that it would announce its second-quarter US sales data on July 3. In the first quarter, the company reported a 1.6% YoY decline in its US sales to 590,249 vehicle units. During the first quarter, Ford’s truck sales rose by 4.1%, and its SUV sales went up by 5.0% on a YoY basis.

On June 25, Credit Suisse initiated coverage on Chipotle Mexican Grill with an “outperform” rating and a target price of $870—a return potential of 20.1% from its stock price of $724.13 on June 24.

Tencent Music Entertainment has generated returns of 14.3% in June. Despite its recent rally, it's fallen 16.4% since April this year. TME is currently trading at $15.13 and is up 14.5% YTD (year-to-date).

172.31.16.229