“Once winter is over…we could see a common seasonal pullback in natural gas,” and “the higher prices seen lately may encourage more capital spending, which could help rebuild stockpiles heading into next winter,” said Colin Cieszynski, chief market strategist at SIA Wealth Management.
On Thursday, the Energy Information Administration revealed on a slightly smaller-than-anticipated drawdown of 77 billion cubic feet, compared to the five-year average withdrawal of 79 Bcf–a supply that’s still higher than last year’s 59 Bcf pull. Total gas in storage fell to 2,914 Bcf, or 722 Bcf below last year and 723 Bcf below the five-year average.
Traders who want to take advantage of the weakness in natural gas can look to the VelocityShares 3x Inverse Natural Gas ETN (NYSEArca: DGAZ), which gained just over 23 percent on Friday.
“Investors should put risk management above all,” and “invest with the [trading]trend as opposed to bottom-fishing or swimming upstream,” said Adam Koos, president of Libertas Wealth Management Group.
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