Natural Gas On Empty, While Dollar Crushes Ags

K DELTA 2015: Commodity futures trading system

Updated 04-13-15

KDelta 2015 profit =$21,651 = 216.5% for 2015 YTD: 62% winning trades

Nat Gad 4-15

Active trades: Natural Gas & Soybean Meal 

 Natural Gas (May) prices should bottom in 2015. The price of Natural Gas has been depressed for over 6 years by excess supply and increasingly efficient means of low cost high volume extraction through Fracking. The demand side of the equation has languished far below its potential due to politics despite the cleaner aspect compared to Coal or Gasoline. There are many kinds of Natural Gas and all were in production decline until the fracking boom exploded higher in 2008. Shale Gas production has gone from less than 5% to over 40% of domestic Natural Gas supplies over the past decade. Currently Large Speculators, Hedge Funds and Managed Money have completely abandoned ship by Shorting Natural Gas, expecting prices to stay low or go lower. Their extreme pessimism hints that prices will bottom in 2015  and begin to rally. An economic acceleration in Europe and elsewhere will likely be the trigger that confirms a bottom in all fossil fuels before year end. Thus far demand growth remains weak, the rising Dollar keeps deflationary pressures on all commodities and very low agricultural prices remove some demand for natural gas in fertilizer. The fundamentals are Bearish and prices reflect the current reality, however due to very negative sentiment, any upward break of the downtrend lines (~$3.00) is likely a sign that a longer term rally has begun.

Short term, Natural Gas has room to fall based upon our recent Sells at the support line at 2620 basis May futures. We have a profit stop in place awaiting a potential exit in the 2420’s.

Nat Gas 4-15

 

Soybean Meal (May) 

The strong Dollar is a deflationary factor that encourages cheaper goods from abroad. The outlook for US agriculturals and Soybean Meal continues to be Bearish with (1) strong Dollar and (2) weak Brazilian Real currency (down 30% since August) along with (3) excellent US growing conditions and (4) the continued effort by Brazil to expand their export crops (26% more soybeans imported into the US over the past 2 years).  Exec Spec readers are short from >314 with 300 and 292 as the next likely targets. However, like Natural Gas, Managed Money funds have liquidated all of their record long bets on the upside for Meal. Such pessimism implies that prices are vulnerable to a medium term low during this years growing season. 

Bean Meal 4-15

See below for the current open and pending trades for the KDelta model as well as all closed out trades for 2015 Year To Date (YTD). The pending trades shown below are mostly Sell signals in the Agriculture and Currencies thanks in large part to the strong US Dollar that keeps domestic prices low as cheaper foreign currencies allow lower priced imports to compete for our consumer dollars. Once Europe can reduce the large growth gap in US vs Eurozone GDP’s then this deflationary trend should be neutralized.

Assume a $10,000 opening account & one contract per trade/signal

Legend: Currencies: Australian $=A6, British Pound=B6, Canadian $=C6,New Zealand $=N6, Euro=E6, Yen= J6, Swiss Franc=S6, US Dollar=DX.  Ags: Corn= ZC, Wheat=ZW, Soybeans=ZS, Soybean Meal=ZM, Soybean Oil=ZL, Oats=ZO, Wheat=ZW, KC Wheat=KE. Metals: Copper=HG, Gold=GC, Silver=SI, Platinum=PL, Palladium=PA. Stock Indexes: SP 500=ES, Dow/DJIA=YM, Nasdaq=NQ, Mini-Russell 2000=TF. Softs: Cocoa=CC, Coffee=KC, Sugar=SB, Cotton=CT, Orange Juice=OJ, Lumber=LB.  Bonds: T-Bonds=ZB, 10 Year Note=ZN, 5 Year Note=ZF. Energies: RB=Unleaded Gasoline; HO=Heating Oil; CL= Crude Oil; QM=mini-Crude Oil

Below: $P/(L)/contract=profit and loss of single contract trade per signal  

           P/L % margin= profit & loss per trade based upon margin required per contract    

Profit/Loss based on $10k account for 2015 YTD    

   

Open positions:

04-09-15 Sell ZMK 314.1  Exit 300.6

04-09-15 Sell NGK 2580   Exit 2421

 

Pending Signal using Buy or Sell Stops only:

Sell J6M 8200  Exit 7950

Buy N6M 7639 

Buy ESM 2110   Exit 2180

Buy ESM 2107.25   Exit 2130

Buy TFM 1269.6  Exit 1279.2

Sell ZSK 928-4

Sell ZMK 292.2

Sell ZLK 29.55      28.07

Sell ZCK 367  Exit 358

Sell CCK 2673

Sell RBK 169.12   Exit 160.54

Buy HOK 181.48

————                                           

 $ P/(L)      P/L

Date         Signal      Entry   Exit date/price        Contract      %margin 

 

03-30-15 Sell NGK 2619     04-02-15 2718               (990)            (23%)

04-02-15 Buy ZWK 540-6   04-07-15   526               (738)            (52%)

04-02-15 Buy KEK 579-4     04-07-15 564-4             (250)            (18%)

03-31-15 Sell ZOK 265-2     04-01-15 262                  162              13%

April results: 1 win & 3 losses P/L=$ (1816)

YTD results=18 wins & 10 losses: P/L = $21,851=218%

 

03-17-15 Sell ZCK 373-4     03-20-15 377-6              (213)           (19%)

03-13-15 Sell D6H 7800     03-18-15 7921              (1210)            (66%)

03-10-15 Sell J6H 8218       03-12-15 8272               (675)             (21%)

02-12-15 Buy NQH 4342.5 03-10-15 4389.5             940                24%

02-13-15 Buy ESH 2089      03-06-15  2089                   0                0

02-26-15 Buy DXH 95.24    03-05-15  96.60            1360               82%

02-26-15 Sell E6H 112.74   03-04-15  111.28            1825                54%   

02-26-15 Buy HOJ 19423    03-04-15 18823           (2520)            (50%)

March results: 3 wins & 4 losses: P/L= $(493);

YTD=$17W&7L: YTD P/L=$23,667=237%

 

02-25-15  Buy RBJ 18825    02-27-15 19528             2952             52%

02-25-15 Buy A6H 7860      02-26-15  7830              (300)          (12%)

02-24-15 Buy HGK 264.10  02-26-15  270.60          1625             43%

02-17-15 Sell LBK 303.75    02-24-15 292.9              1193              68%

02-18-15 Sell OJK 133         02-23-15  129                    600             45%

02-17-15 Sell KCK 161.15    02-19-15 154.20             2606             59%

01-16-15 Sell ZSH 990-6      02-03-15 966-6             1200             44%

February results:6 wins & 1 losses:14W/3L:P/L=$9,876:YTD=$24,160=+242%

 

01-28-15 Sell QMH 4479      01-29-15  4369             550               20%

01-26-15 Sell S6H 11353      01-29-15 10891            5775              69%

01-22-15 Sell B6H 15026      01-26-15 15053          (169)               (9%)

01-13-15 Sell ZMH 336.9      01-20-15      322.2     1470               67%

01-15-15 Sell NQH 4080.5    01-16-15    4101.5      (420)            (11%)

01-12-15 Sell HOG 16714    01-13-15      16316          1671               44%

01-12-15 Sell QMG 4682     01-13-15         4545         685               37%

12-15-14  Sell HEG 83.25      01-06-15      78.17      2032             154%

01-02-15 Sell D6H 8544        01-05-15       8472        720              57%

12-30-14 Sell CLG 53.97        01-05-15       50.03    1970           105%

January results: 8 wins & 2 loss: P/L=$14,284= +143% gain on $10k account

———–

Disclaimer and Notice:  Nothing herein, including any attachments, should be construed as an offer to sell or as a solicitation of an offer, or a recommendation, to buy any interest in any investment or other product. This may contain information on investments that are high risk and have substantial risk of principal loss.  It is for informational purposes only. Statements in this communication that are not statements of fact are merely opinions or forward looking statements from a potentially biased source(s) that involve known and unknown risks, uncertainties and other factors that could cause actual future results to differ materially from any prior or projected results. Statements in this communication may be inaccurate and/or unsuitable for you.  You must perform your own due diligence.  Your investment decisions should always be made based on your specific financial needs, suitability, objectives, goals, time horizon and risk tolerance.  Any decision is at your sole discretion and at your sole risk.  You are advised to consult with your individual investment and tax professionals before making any investment.  Past performance is no guarantee of future results.

 

Leave a Reply

Ready to start creating financial success? START YOUR FREE TRIAL