Velocityshares 3X Long Natural Gas ETN (UGAZ)

[dude iligence]

Contango can be deceiving to the Newbie NG traders. Heres the Contango gap up, finviz rolled the chart from Jun to Jul last night. Stockcharts the night before. There is an 8% difference in price. 8x3=24% Thats how much UGAZ is going to lose for any given price of NG when the contango is unwound. UGAZ is tracking July. Ask yourself do you expect the price of NG to stay up at $1.85 or go back down to where the Jun contract was trading yesterday $1.7ish. Any closing of that gap is a loss for UGAZ and a gain for DGAZ. Contract expires 5/27/20. Given this reoccurring contango unwind, one can position them-self to take advantage of the phenomenon. DGAZ will gain approx the same % for any given price of NG during and after the unwind. Any closing of that gap and DGAZ goes up in price. Buying UGAZ right before chart roll with sizable Contango has extra risk built in. NG may rally during this time like we saw last fall when NG trade was flooded with Newbies that confused the gap up as a breakout and went on a buying spree a couple weeks later it still unwound. I dont see that much excitement happening at this moment. As we all know expect the unexpected with NG. Use a stop limit when trading 3X leveraged monsters unless you like having your arms and legs ripped off and eaten while you watch.