Trade of the Week: long natural gas
This week's trade is to go long natural gas as the price recovers from the 50-day moving average, with an initial target of 2930 and a stop of 2500.
Trade of the Week
Good morning and welcome to IG’s Trade of the Week for the week beginning Monday, 31 July 2023.
We're going to look at the trade for this week in a second. But we'll look back to last week’s the week of Monday, 24 July. We look at going long AUD, which at that point a week ago seemed to be bottoming out around the turn of day moving average. It was starting to move high.
Now it did actually begin higher during the course of the week, but then we had a drop to three days of sharp losses now off the back of the disappointing Chinese data. So you just have a reversal which then stopped us out at the 6680 level that we picked as our stop and then continued on from there. Now it seems to have recovered here, but it's a bit of a perhaps a neutral one at the moment. We're not quite sure whether this is the beginning of a more sustained recovery or not. So that one was stopped out.
Natural gas excites markets
Turning to this week, we're going to look at natural gas with the commodity markets and the signs of a recovery here in natural gas prices, which haven't seen that much upside over the past month or so. But you certainly seen a bit of a recovery from where we were mid-month in July.
So we’re look at going long natural gas with an initial target ready. I think at least around that late June high at 2930 and potentially on beyond that to go long natural gas with a stop as ever, the most important thing we're going to put this one just below the 50-day moving average at the 2500 level. So if it does cross back below the 50 day and loses a bit more ground, that will be stopped out down there.
But this is the trade for the week beginning Monday, 31 July, we have a long at natural gas with an initial target at 2930 and our stop down 2500.
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