Depending on where you live, you wouldn't think that winter is fast approaching, but it will come at some point, and with winter comes cold, and with cold comes increased heating of homes ... . Hence, a seasonality
play in UNG
comes to mind, particularly with UNG
trading at or near range lows (it's been between 12.25 and 15.25 since late January). Moreover, recent EIA
data suggests a decline in production going forward, which may add to the seasonal
boost that natural gas
ordinarily receives in the winter months. I'm going with a January expiration, since previous data suggests that that is when maximum consumption of natural gas
occurs ... .
Here's the idea:
Jan 15 12/13 long call debit spread
Max Profit/BPE: .48 debit/.52 debit
POP %: 49%
Notes: You're basically playing one to make one ... .