El Nino to bring Nov rain??Trading fun with DGAZ and more!!

So was the massive convertible offering why OMER is down so much or was it something in the earnings report?

If that DGAZ didnt have so much decay I would consider going long here...but look at the chart its at multi year lows and that isnt because of the price of crude, this thing decays like UVXY does, so the move has to be large to get it to budge, you are fighting against decay and that decay never stops.

Id even be tempted to open a futures acct and try some long crude but that is even more leverage and more risk than this DGAZ is.

Same goes for the 3X long crude, its on the same death march down due to decay..so even when the underlying moves up that move is not 3X correlated because of that decay and churn due to always having to buy and sell futures contracts/options (whichever applies as per the prospectus).

Even when crude was up earlier the ETF wasnt going in the right direction. I seem to remember when it got closer and closer to a big expiry then the selling on these leveraged contract based ETFs increase more than usual.

So that article from seeking alpha was helpful, I was unaware that power companies have been switching from coal to NG and that is making the futures move like this. If you notice the forwards are not staying high for long, the move is not seen as long term and the market is anticipating a return to the 2s by spring. I still dont see how even with power companies switching that it changes the long term picture of NG...we have and will continue to have a massive glut of NG, so maybe this is also in part due to shorts covering and going long and it being more of a speculative reason because I dont see how the supply will drop to any large degree for a very long time even with a switch from power generators.

I dunno...too much lower and Canada will start adjusting, they are running production at massive losses now and the environmental abusing frackers are going to start reeling if oil stays here...even with the forwards locked in they wont last forever and some counter-party buyers might force renegotiating of terms if prices drop much more.

What a wacky market...some rumors of a Brexit blah blah and they bounce it 300 pts in a few minutes.

This NG action reminds me of shorts being squeezed, there might be a few leveraged firms out there that are right at their breaking point and the market is sniffing out these leveraged folks and lets see where it leads. I dont see this as a supply demand move at all.

I gotta think lower vs higher...none of the players are trying to defend and prop price of crude. In the past the Saudis or Russia would start loosely throwing out production cut talk to stop the drop but none are doing that. I also dont get how the US shale players are not trying to slow down given that their margins are pretty much gone now and many are running production at a loss at this level.