Jeff 11:07 am on Wednesday, October 17, 2018
Tags: ContangoETFs ( 446 )

BOILing over again

#ContangoETFs
Sold $BOIL Dec 45 call for 2.45
Sold $BOIL Jan 45 for 3.80, adding to my position

Ramie 11:33 am on Wednesday, October 17, 2018

Sold Dec 50 call for 1.80 adding to my call sale from earlier this morning.
- Jeff 11:41 am on Wednesday, October 17, 2018
  
  It ran 10 points higher, or about 45%, in the last month. Can it go another 10 in the next month?
  - fuzzballl 11:49 am on Wednesday, October 17, 2018
    
    Scrolling back through the chart it looks like a double is possible but rare. Can’t see much upside above the 50 area here unless we get another winter like 2 or 3 years ago. So cold in the fields that the valves were freezing shut. Seems like nat gas got a squeeze over 6 for a short period. I remember selling BOIL in the money call spreads during that. Fun!!
    - fuzzballl 11:50 am on Wednesday, October 17, 2018
      
      Feb 2014
    - fuzzballl 11:52 am on Wednesday, October 17, 2018
    - Jeff 12:01 pm on Wednesday, October 17, 2018
      
      I remember that. And I also remember Napoleon Solo ridiculing us for it.
      - fuzzballl 12:03 pm on Wednesday, October 17, 2018
        
        Lol…forgot about that!
  - Ramie 11:49 am on Wednesday, October 17, 2018
    
    Hard to tell with the charts from these inverse/leveraged funds since they’re so affected by drag. But if we use let’s say just the futures (see below), it does make sense that BOIL went up 45% since Sep since the nat gas futures went up roughly 20% since then. Taking it back to the highs on the chart from early this year would be somewhere in the 8-10% area if we got back up there on the futures. Doubling that, using 20% again from here would bring us to around 45. Will of course be watching closely.
    - Ramie 11:54 am on Wednesday, October 17, 2018
      
      Or…what Fuzzy just posted! If that kind of winter were to happen then all bets are off. Except the new ones we place fading the move!
      - fuzzballl 11:56 am on Wednesday, October 17, 2018
        
        Futures are in contango until….you guessed it. Feb Mar 2019.
        
        Ramie 11:56 am on Wednesday, October 17, 2018
        
        Hahaha those futures traders seem to know what they’re doing 😉
        
        fuzzballl 11:58 am on Wednesday, October 17, 2018
        
        If I’m reading that right…not real familiar with them.
fuzzballl 12:04 pm on Wednesday, October 17, 2018

Nothing scary in the temps yet either but it’s all a guess at this point.
- fuzzballl 12:11 pm on Wednesday, October 17, 2018
  
  Blast from the past:
  
  https://www.cnbc.com/2014/01/24/natural-gas-price-spikes-topping-5-for-1st-time-since-2010.html
hcgdavis 7:50 pm on Wednesday, October 17, 2018

I have been playing it from the LNG side. Only US exporter of natural gas.
- fuzzballl 8:56 pm on Wednesday, October 17, 2018
  
  BOIL is one of our contango infested pieces of junk that makes a great fade on any rally. More about the drag than the direction really. I wish it had weeklies.
  
  BOIL Split History Table
  Date Ratio
  05/11/2012 1 for 5
  05/20/2015 1 for 4
  03/20/2018 1 for 5