NatGas - No Moon Until Doom

NYMEX:NG1!   Natural Gas Futures
In mid June, I had made a call that Natural Gas was about to rally, because price action and timing supported a move upwards.

Natural Gas - The Girl Who Hopes You Remember Her

But that call became abandoned as I enlightened and improved further, and began to note that rallies were sold off and lows kept being taken.

The trade degenerated into looking at a sweep over $3 and then a sweep over $2.9, and turned into abandonment.

Before we go far, I want to tell you that you need to keep your eyes on the situation with China.

The first thing you notice is that the propaganda machine and politicians are rarely going after "the Chinese Communist Party" but are always going after "China."

This is very strange. China is the world's only 5,000 year country and holds the largest population.

If you think about it even a little bit, the CCP would be so easy to topple, wouldn't it?

Considering the Party has killed a magnitude more of its own people in its century of murder than Hitler did among all races during his years of insanity.

And the CCP and former Chairman Jiang Zemin have the 24-year persecution and organ harvesting genocide against the Falun Dafa spiritual practice hanging over their head like the blade of a guillotine.

You have to keep this in mind and go study it. A really crucial part of the puzzle is that Xi Jinping, for all the criticism and targeting he gets/deserves, has never persecuted Falun Gong.

Instead, Xi's Anti-Corruption Campaign has been killing and ruining the Jiang Faction minions who have conducted and operated the persecution.

Xi has even protected Falun Gong in Hong Kong after fortifying his rule there with the National Security Law following the 2019 Heaven Will Eliminate the CCP protests.

All of this matters very much to the fossil fuels industry because there's a relationship between China and Russia, both in terms of production and demand, that changes greatly if something like the Ukraine War ends or drama over Taiwan suddenly enters nuclear brinkmanship.

Looking at current monthly bars, Natural Gas shows some kind of "Bear Flag."

What you're seeing, really, is an extended consolidation. This is actually potentially really bullish, to the upside, but we need price action to confirm it's time to go.

Unfortunately, July did not show us this.

The sweep of the $2 point and the lows in April was not enough to springboard the move, and that's really telling.

While many may tell you that natural gas is obviously going to a zero-handle, a look at the yearly bars shows such a thesis really does not make sense.

To the contrary, the 2020 pivot should, actually, hold. A classic super long term breakout and retrace.

Moreover, $10 was printed for literally one day in 2022, and that's very strange.

The problem with the moon turning full right now, is shown on 3 month candles, where this current little red blip only has one month left.

This is not a bullish continuation. It's important, in a bullish scenario, to see volume come in and price action to correspondingly reflect that producers want to sell at higher prices and will orca the waves for us normal people.

Moreover, in terms of the overall markets, as I post in this week's SPX call, we may be watching the equities/indexes bear market rally top for real.

SPX - The Sound of a Shattering Iceberg

As for what might be the news driver that harbingers the correction, it may very well be one of the 10 largest banks in America dumping for whatever reason emerges (watch out for commercial real estate):

Charles Schwab - The Harbinger Of The Next Crisis?

I also posted last week that it seems to me oil is about to head for a literal 3-handle.

Oil - A New Long Leg Down Soon Begins

And because we have problems with "Taiwan," which is to say the International Rules Based Order's desire to take over China via Taiwan while the Chinese Communist Party falls, I also believe that Taiwan Semiconductor (TSM) is set up as a probable long hedge through to the end of the year and into 2024:

TSM - Taiwan, Your Semiconductor Long Hedge

Now, in terms of natural gas ranging like it has, sharply dumping, and then beginning a new and major bull impulse, this is not without grounds, for this would be a fractal of the 2020 COVID dump-to-recovery play that saw a doubling into year end:

If this were to play out, we'd see something like $1.60 natural gas into $4.8 by the end of the year or Q1 2024.

After that, we may really see prices that exceed $10 and begin to flirt with all time highs at $15.

The fundamental factors that would cause a 10 bagger on a commodity that literally equates to most of the world's electricity production are fairly significant.

Especially considering "climate change" (lol "climate boiling") is attempting to be used as the pretext/excuse to export the Jiang-CCP Zero COVID social credit system worldwide in a way that far exceeds what was done during the pandemic.

And so for the call, I would say the "short signal" with the markets hanging out in thin air at present, while we're about to begin a new quarterly shift, is a break of the $2.4 level.

You'd want to short that break with a target meaningfully under $1.8 and then cover it without getting greedy.

At that point, it's time to look for longs, and if you're a long term position trader, this may be one of the best opportunities you'll come across.

But it may not really unfold until next year. And this assumes that my analysis is correct.

Right now, daily price action is just showing failure swings, but nobody has stepped in yet to give it the push down the stairs it really needs.
Looking at Natty on the 4H candles, there's really nothing here that inspires confidence to the upside.

And yet every time it gaps down, it exceeds the gap after grinding for a while.

So, it's too early to be short, probably, but long might only have 5-8% upside.
More gap downs and taking more lows is not bullish.

Yet because it's August 1, it's very difficult to anticipate what the intention is. Note that July was a pretty small range.
Places I think NatGas could reverse are really just $2.35-$2.4.

I have reservations the old $2.9 or $3 theory is in play. But $2.85 to smash some trendlines is possible.
The long awaited raid on $3 has finally arrived with little fanfare.

Still a lower high at present compared to the ~April peak.

Big dumps here would be bad news for bulls.
Natty reversed before taking the March high, but could still be considered bullish on the August monthly candle.

There is range to the upside it can trade to.

But this is bad price action for a real bull run. The good news is that oil should really raid $85 before the doom for fossil fuels is really on.
Have to say that natty's rejection from $3 looks pretty legit and we're in a lower highs scenario.

Yet it seems on the daily that some kind of reflirtation with $2.75-$2.8 is on deck.

And it may be a very nice rip to sell.

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