Natural gas prices have been crushed today
Trading natural gas isn't for the meek. The regular intraday moves are often over 3% but today is a whole different level.
Front month natural gas futures are down 10.3% today and that's the biggest one-day drop in at least a year as selling has accelerated in the past hour.
if you look at the chart, it's not that bad because natty rose 56% from the lows in mid-November. The December low of $3.24 is key for the short term.
Analysts say today's drop came after forecasts for warmer January weather.
What's interesting is that there is a long-term seasonal trend of natural gas strength in January. It's as if every year the market anticipates a brutally-cold January but once the calendar turns, the forecasts don't seem all that bad.
The average decline since 2000 has been 3.63% and it's been -2.3% in the past decade.
The thing about the weather is that it's always changing. What doesn't change is that holding onto long-term natural gas positions is insanity.
