We all have been hearing about the great European floating natural gas trade of the Winter of 2022. Politicians, pundits, intellectuals, academics, influencers... everyone has something to say about it. Well, you know what they say: if everyone is talking about a trade, the opposite might occur. A number of catalysts have reversed people's expectations. European natural gas and electricity prices are crashing as a price caps have been imposed and as gas storage levels remain high. Apparently FLNG terminals are being turned away from Europe's import hubs. So... this trade has probably peaked already.
EE set itself up for a beautiful base breakout and retest, but appears to have formed a daily downtrend at $28.40 after rejecting from the all time high of $31, forming a Head and Shoulders Pattern with a neckline at $25.10. There is a possible Bear Flag being sandwiched in between the 50 Exponential Moving Average, downtrending resistence reaching the neckline, and a support line going back to the stock's all time lows six months ago. There is also a double bottom at the neckline-- if it breaks then the target could be around the previous strong demand zone at $22.50.
EE set itself up for a beautiful base breakout and retest, but appears to have formed a daily downtrend at $28.40 after rejecting from the all time high of $31, forming a Head and Shoulders Pattern with a neckline at $25.10. There is a possible Bear Flag being sandwiched in between the 50 Exponential Moving Average, downtrending resistence reaching the neckline, and a support line going back to the stock's all time lows six months ago. There is also a double bottom at the neckline-- if it breaks then the target could be around the previous strong demand zone at $22.50.
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I'd recommend checking out the charts of other floating natural gas tickers such as KNOP & DLNG. Money is flowing out of this sector, presenting a few nice topfishing trades in the coming weeks.
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Stop at $26.50
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The peak of the volume profile is @ $27 & $28. Probably will sell off from there.
Trade active:
Entered at the top of yesterday's daily shooting star candle, at the first five minute red candle at $26.70. So far + 4%... but underneath $26 will be a contentious zone. The natural gas sector is getting absolutely crushed today so I expect to see follow through of this H&S by the end of this week.
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Hourly double top at $26.40... I spy a H&S
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Performing well
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I think it's actually retesting the neckline, could still be a short. I'm out but the technicals are nice.
Trade closed: target reached:
I wouldn't be surprised with natural gas bounces here and the stocks catch a bid.