Natural Gas Cycles

August 10, 2023 Eric S. Hadik

Natural Gas Cycles:

(Major Bottom Forecast for late-2019/early-2020 followed by 2 – 3 year surge as part of its overall outlook from early-2020 into 2026)

Throughout 2019, INSIIDE Track explained why Natural Gas should set a MAJOR, multi-year bottom in late-2019/early-2020 – between 1.60 – 2.00/NG – and then surge into 2Q/3Q 2022… and to specific upside targets near 8.00/NG and ultimately 10 – 11.0/NG.

If fulfilled (as it ultimately was), that would reinforce future cycles in mid-2024 and late-2026 – mid-2027… as a major paradigm shift was/is perceived to be taking hold in the energy markets.

For INSIIDE Track traders, who followed this analysis and the published trading strategies, it meant entering a massive bull market near its very bottom and finally exiting within weeks of its ultimate peak! [FUTURES TRADING INVOLVES SUBSTANTIAL RISK!]

Ultimately, it was a powerful combination of technical indicators that signaled the bottom and triggered multi-year buy signals (published repeatedly for subscribers; including the timing and price levels to add to long positions on key pullbacks)… but key cycles set the stage.

Those cycles were ones that specifically govern Natural Gas AND ones that impact our environment, climate, and geopolitical stability (or lack thereof). And many of those cycles portend some surprising events in the coming years – leading into late-2025 and ultimately into late-2028 (a momentous ‘week of time’ – or 7-year period – from late-2021, when a ‘seismic shift’ was forecast to take hold).

So how did this unique trading opportunity emerge?

Converging Cycles

For many years, INSIIDE Track explained why long-term cycles were expected to spark another global warm-up in the late-2010’s – leading to a multi-year peak in warming (and drought) cycles in the early-2020’s. While many traders associate Natural Gas and its demand with cold winters, it is actually hot summers that have triggered some of its big surges in recent years… as power plants look to additional energy sources to handle increased demand. (Some of that analysis can be found at https://www.insiidetracktrading.com/wp-content/uploads/40-Year-Cycle-Climate-Drought-Deluge.pdf)

Other analysis focused on the onset of a new Sunspot Cycle – Solar Cycle 25 (which began in Dec 2019) – to play an influential role in the outlook for a surge in Natural Gas from major cycle lows in 4Q 2019/1Q 2020 into multi-year cycle highs in 2Q/3Q 2022. But those were only general cycles setting the backdrop. They are NOT something off which to trade!

Reinforcing that, and creating a Perfect Storm of potentially bullish factors for Natural Gas during that 2 – 3 year period were War Cycles (80-Year Cycle of War that dates back to at least the 1200’s) kicking in in late-2021. They had been discussed in publications and in dozens of podcast interviews in which Eric Hadik participated since 2014… each time projecting War Cycles to re-emerge in late-2021 – late-2025.

At the same time, Natural Gas had triggered sell signals in late-2018 that projected a 1 – 2 year drop back toward their previous low (~1.600/NG)… so price, wave, & trend indicators were corroborating.

The 2015 outlook for a final surge in drought and warming cycles – from 2016/17 into 2021 – was corroborated by longer-term cycles projecting a major, multi-year bottom in Soybeans, Corn & Wheat during that period… and the onset of accelerated advances (usually the second or third 1 – 2 year rally within a series of rallies).

Natural Gas cycles had bottomed in 1Q 2016, ~4 years from a previous bottom in 1Q 2012, and were projecting a multi-year advance in 2016 – 2018. However, it was the ensuing phase of the ~4-Year Cycle – in 1Q 2020 – when all the stars were aligned (figuratively and maybe literally when Solar/Sunspot Cycles are considered) for a Major advance to take hold in Natural Gas.

[1Q 2016 was also the latest phase of a ~7-Year low (1Q 1995) – low (1Q 2002) – low (1Q 2009) – low (1Q 2016) Cycle Progression that could time a subsequent low in/around 1Q 2023.]

Natural Gas would go on to rally into late-2018 before beginning a correction that was forecast – since early-2019 – to last into late-2019/early-2020 before a much larger, multi-year advance would take hold.

A 4th multi-year cycle joined that discussion in early-2019, reinforcing the repeated warnings for a major shift in early-2020, following the expected onset of Solar Cycle 25 and the projected fulfillment of ‘Global Shaping Events’ forecast for early2020.

The March 2019 INSIIDE Track examined the role of the ~11-Year Sunspot Cycle and how it – along with all these other cycles – was expected to usher in a very challenging period in 2019 – 2022. Natural Gas was one of the commodities projected to experience a runaway, inflationary advance during that period!…

02-27-19 – “INSIIDE Track: “Outlook 2019 – The ~11-Year Cycle

The Sun has at least three intriguing cycles that repeatedly emerge in the markets, in geopolitics, in military conflict, and in most aspects of life. The biggest (of these three, although there are also longer-term cycles as well) is the ~40-Year Cycle of the Great Conveyor Belt of the Sun.

To summarize it, this is the plasma flow that circumvents the Sun, moving from its equator out toward one of the poles and then – after sinking lower – back toward its equator. It takes approximately 40 years for that to transpire… and then it occurs toward the opposite pole and back.

So, a total circuit would take roughly 80 years (perfectly coinciding with the 80-Year Cycle of War that comes back into play in 2021, linked to the US entry into WWII in 1941, into the Civil War in 1861 and out of the Revolutionary War in 1781. In the colonies, England and Europe, that has been documented for a few hundred years before 1781.).

If I understand the process correctly, the initial phase – flowing from equator to pole – goes along the surface of the Sun and ‘sweeps’ up decaying sunspots and their related magnetivity and then drops them off at the poles. As a result, it greatly impacts the magnetic force of the Sun… which impacts subsequent sunspots and the magnetic barrages periodically flung at Earth (CMEs)… which could have an exponentially greater impact as Earth converts to a digital world.

As a result, it would stand to reason that the fluctuations of the Great Conveyor Belt of the Sun dramatically influence the other two primary cycles in this discussion.

To and Away

The second solar-related cycle is the 17-Year Cycle that impacts some form of magnetic interplay between the Sun and Earth (the ‘to and away’ interaction as described by David Juckett at https://link.springer.com/article/10.1023/A:1005075703810). This has also been repeatedly discussed over the past two decades. It has its strongest impact at the 34-year point (two full cycles), when it coincides with three of the following solar-related cycles…

Cause and Effect

Perhaps the best-known solar cycle is the one that governs the ebb and flow of sunspots or solar storms. It is an ~11-Year Cycle (averages out to 11.2 years) that has an uncanny knack for also linking monetary and military events of cause and effect. Perhaps a better way of describing that would be the Cycle of Unintended Consequence.

Events during one phase of this cycle often have a distinct and irrefutable link to events during the next phase. In many cases, those phases also link similar players or similar events. (I have often documented an overlapping 11- Year Cycle that… recurs in 2021/2022.)

As time has unfolded, it has become clear that the Western financial and economic collapse of 2008/ 2009 drove countries like China & Russia into closer cooperation with one another, as an alternative to the US & Europe (see previous discussions on multiple unions spearheaded by China & Russia). This cycle comes back into play in 2019 – 2020 and is likely to perpetuate/foster that alignment…”

INSIIDE Track, March 2019

By early-2019, that ~17-Year Cycle was already in focus – anticipated to have a profound impact on Natural Gas – timing a future high in 2Q/3Q 2022 – ~17 years from its September 2005 peak (coinciding with the impact of Hurricane Katrina, although it had already been in a ~2-year surge at the time that Hurricane struck).

In the immediate future, the 2019 – 2021 collision of civilization-altering cycles was beginning. It would usher in what has been forecast to be a tumultuous ‘week of time’ from late-2021 into late-2028. The most important objective was to take all this to a practical and tradeable level so readers could capitalize on this (perceived and expected) remarkable opportunity.

As 2019 unfolded, INSIIDE Track was doing its best to prepare subscribers for an impending (projected) multi-year surge in Natural Gas… while also keeping them out of the market until the time was right/ripe.

Timing is Everything!

This is what was published during 2019:

01-31-19 – “Natural Gas has remained under pressure since fulfilling its upside target for 4Q ’18 (~5.000/NG). On a 1 – 3 month basis, Nat Gas remains likely to set a multi-month bottom in 1Q 2019 – perpetuating a ~360-degree cycle from recent years. More precisely, a 51-week low-low-low-(low) Cycle Progression projects that low for Feb. 4 – 11, 2019 (although anytime in Feb. 2019 would fulfill the corresponding ~12-month low-low-low-low Cycle Progression).

On a larger-degree basis, Natural Gas could wait until 4Q 2019/1Q 2020 – the next phase of a consistent ~3.75-Year Cycle and corroborating monthly cycles – to set a major bottom.”

03-29-19 – “Natural Gas spiked to new 12-month (contract) highs but could not trigger an intra-year uptrend, signaling an intermediate top and projecting selling into early-April. Consistent with what has been previously discussed, Natural Gas could wait until 4Q 2019/1Q 2020 – the next phase of a consistent ~3.75-Year Cycle and corroborating cycles – to set a major bottom.”

04-30-19 – “Natural Gas remains weak and could wait until 4Q 2019/1Q 2020 – the next phase of a consistent ~3.75-Year Cycle and corroborating cycles – to set a major bottom. It turned its intra-year trend down in April and dropped sharply, reinforcing this overall outlook. It would show no signs of an intermediate bottom until a weekly close above 2.6700/NGM.”

05-30-19 – “Natural Gas remains weak and could wait until 4Q 2019/1Q 2020 to set a major bottom. It turned its intra-year trend down in April and dropped sharply, reinforcing this overall outlook… and should ultimately spur a drop to new contract lows and eventually down toward ~2.000/NG.”

06-30-19 – “Natural Gas remains weak and could wait until 4Q 2019/1Q 2020 to set a major bottom. It turned its intra-year trend down in April and dropped sharply, reinforcing this overall outlook. That should ultimately spur a drop to new contract lows and eventually down toward ~2.000/NG.”

07-31-19 – “Natural Gas remains weak and is expected to wait until 4Q 2019/1Q 2020 to set a major bottom… It has declined since turning its intra-year trend down in April and is expected to eventually reach ~2.000/NG… Expect more volatility (and shorter sell-offs) as Natural Gas nears the time for a major low.”

08-30-19 – “Natural Gas remains weak and is expected to wait until 4Q 2019/1Q 2020 to set a major bottom… It has nearly reached its primary downside target (~2.000/NG) so consolidation is likely near this support.”

That continued throughout 2019 as other corroborating cycles aligned in early-2020. The 2019 focus on the impending Solar Cycle transition (that ultimately occurred in Dec 2019) – projected to spur seismic shifts in our world (including a likely 2 – 3-year inflationary period in 2020 – 2022) – continued throughout that year, including the following October 2019 INSIIDE Track analysis.

“Outlook 2019/2020: The ~11-Year Cycle – Part II

09-30-19 – There is another overriding cycle that could also be playing a role, even though it is considered more general and abstract. It does, however, govern the explosive nature of the Sun which does have a measurable impact on Earth…

11-Year Cycle

The Sun goes through an approximate 11-Year Cycle (11.2 years is the most recent average) that envelopes its activity peaks to troughs and back to peaks again. So, the lowest levels of solar activity (solar storms/sunspots and the resulting electromagnetic storms that are often hurled toward Earth) are divided by about 11 years and the most active phases are also divided by about 11 years.

In a strong parallel to Earth’s 17-Year Cycle – and its overlapping and more consistent 34-Year Cycle – the Sun possesses a 22-Year Cycle that is able to filter out some of the ‘white noise’ and demonstrate a stronger correlation between sunspot peaks or troughs and coinciding events.

It is that 22-Year Solar Polar Cycle that is a more precise or consistent cycle, partially due to how the Sun’s magnetic oscillations evolve. During each ~11-Year Cycle, the Sun alternates the polarity of its sunspots – basically from northern-oriented to southern-oriented… and then back again.

So, it takes a full ~22-Year Cycle to return to a similar phase (with similar polarity) as its predecessor… Previously, I made reference to another moderate link that now deserves some added attention and reiteration…

The reason I refer to it as a ’moderate link’ is due to the small number of data points involved. However, it has maintained a 100% correlation – with those data points – so it should not be ignored. The data points all involve the time when the Sun is exiting its lowest point of solar activity – when few or no sunspots are detected for many months – and then begins to enter its next Solar Cycle with an intensification of these solar storms.

Like so many cycle transitions, this shift is often when the most abrupt reactions are witnessed in our world…

Late-2019 times momentous cycles… 11 years from the start of a previous price-inflationary period from late-2008/early-2009 into 2011/2012…. it is the time when the Sun could finally come back to life! Could we see some fireworks (begin) in 4Q ’19?”…

Natural Gas remains weak and is expected to wait until 4Q 2019/1Q 2020 to set a major bottom – ideally near ~2.000/NG. It corroborated that outlook by entering some intervening consolidation and rebounding into mid-Sept. without turning its weekly trend up. That was projected to set a peak on Sept. 10 – 20, based on the weekly LHR, weekly trend and a ~6-month/~180-degree cycle from its March 19, ‘19 peak. Natural Gas peaked on Sept. 16 and has since sold off.”

INSIIDE Track, October 2019

Natural Gas cycles were already dovetailing with these solar-related cycles (coincidence does not necessarily mean causality). Not only would a surge into 2022 fulfill a 17-Year Cycle from the 2005 peak, it would complete a ~22-Year Solar Polar Cycle from the 2000 peak – one of three successive peaks leading into 2005.

The November 2019 INSIIDE Track expanded this analysis and began to focus back on one particular – and globally-important – shift that was forecast to take hold in late-2021, the same time the latest phase of the 40-Year Cycle of Currency Wars was culminating (currency/financial ‘wars’ often preceded military ones).

It involved the outlook for an 80-Year Cycle of War – that had ‘governed European conflict’ since the 1200’s – to return in late-2021, the same time that climate cycles were expected to reach an extreme:

“Outlook 2019/2020: The 80-Year Cycle

10-30-19 – America’s Trio of 80YCs

In articles over the past decade, I have detailed the 40-Year Cycle that has governed America’s entire existence – incorporating everything from currency to conflict to agricultural development and shifts. Global gold and currency action – dating back to (at least) the 1200’s has adhered to that cycle.

That cycle projected a momentous shift for 2017 – 2021.

A higher-magnitude 80-Year Cycle has timed the bigger, over-arching evolutions – most notably America’s involvement in major wars (1781 – 1861 – 1941 – 2021?). That 80-Year Cycle of War has also governed European conflict – prior to and overlapping America’s existence as a nation – dating back hundreds of years prior to 1781…

This is just one subtle validation of the dramatic shift expected to take hold as America’s third 80-Year Cycle culminates. There are other ’seeds of change’ that confirm related 80-Year Cycles and portend dramatic changes in the ’20’s… Could that shift accelerate in the 2020’s? ”

INSIIDE Track, November 2019

As Natural Gas cycles were nearing a bottom, most likely in early-2020, the focus began to heighten on projections for a new ‘Cycle of War’ to take hold in late-2021 – late-2025 (with reverberations into late-2028 expected) and test the mettle of NATO, particularly against Russia.

For over a decade, INSIIDE Track had described European Unification Cycles that were forecast to reach a crescendo in 2018 – 2021 and then lead to a new push for increased unification – also from late-2021 into late-2025 (and into late-2028). Repeatedly, INSIIDE Track explained how Europe would have to ‘near the edge of the abyss’ (of disunity) before the individual nations would be compelled to sacrifice some sovereignty in exchange for unity.

In late-2019, all of those ‘ducks’ were beginning to align ‘in a row’.

While the specifics of a future Russian invasion of Ukraine were not known, back in late-2019, published cycles were already making it clear that war was on the horizon, it would likely involve Europe, and it was equally likely to intensify the conflict between NATO and Russia. That analysis remained a focus for the ensuing years and overlapped the outlook for Natural Gas to see a major surge into 2022.

The December 2019 INSIIDE Track expounded on the outlook for Europe, NATO, and Russia to soon come to a head, with the potential for Turkey to play a pivotal role. The key was for Europe to first appear as if it was ‘down for the count’ (a boxing metaphor, implying a potential knock-out):

“Outlook 2020/2021 – 2020 Vision

11-30-19 – As the markets enter the final month of 2019, it is a good time to step back and view the forest for the trees. The ‘forest’ can be viewed on multiple levels – with the primary emphases on the recurrence and convergence of the 40-Year, 70-Year & 80-Year Cycles in 2019 – 2022.

That applies to the markets, to the Middle East, Europe and overall global geopolitics (including cycles of unification), to cycles of war, to ongoing currency battles and even to earth disturbances…

And then there is the role of Europe…

The 70-Year Cycle & NATO

On Nov. 7, an article in the Economist highlighted French President Macron’s Oct. 21 interview declaring that ‘NATO is brain dead’ (see page 4)…

…to which NATO Secretary General Jens Stoltenberg assured Europe that NATO is not dead yet (https://foreignpolicy.com/2019/11/07/nato-stoltenberg-shoots-back-france-emmanuel-macron-calls-brain-death-dead/).

…after which Austrian’s President Van der Bellen proclaimed his agreement with Macron on NATO ‘brain death’ (https://tass.com/world/1088302).

There seems to be some Euro-discrepancy.

So, a follow-up article in the Wall Street Journal attempted to clarify this (https://www.wsj.com/articles/nato-isnt-dead-but-its-ailing-11573516002). It described NATO as ‘ailing’ but not (yet) brain dead – particularly noting NATOs impotence against Russia and now Turkey (a member nation).

Well, that’s reassuring!?! NATO is not dead… YET.

That should put everyone’s mind at ease. NATO is fatally ill and encroaching on brain death… but don’t worry, its not dead yet…

The 40-Year Cycle & Turkey

In the early-2010’s, INSIIDE Track described primary forecasts for Europe/US relations in 2013 – 2021 (with greatest synergy in and focus on 2018 – 2021).

The first supposition was that America would steadily be isolated – both politically and economically – as a collection of competitive or adversarial nations worked to supplant the US Dollar as the global kingpin of foreign exchange and trade AND sought to unseat America’s increasing power in the absence of a single ‘equal’ competitor.

That sounded a bit more outlandish, back in 2010.

The second was that Europe and the Euro would struggle through much of that period ultimately leading to a dire perception of Europe’s future. That would then – as described back in 2013 – 2015 – lead to a revised European Union, developing in 2018 – 2021 and likely reaching fruition in 2021 (at the same time War Cycles would peak… is there a connection?)…

The 11 & 22-Year Cycles Join In

More than anything, the events of 2017 – 2019 have revealed and/or created a dangerous, smoldering tinderbox of global tensions and anxieties – awaiting a decisive dousing of geopolitical gasoline and a well-timed spark. For over a decade, the focus for the next serious global conflict has been on 2021 – the next phase of the 80-Year Cycle of War…

It is worth noting that the heightened potential for a global, military flare-up is perfectly timed with when the Sun is expected to enter its own period of intensifying flare-ups. Evidence is mounting that Solar Cycle 25 has begun (see inset). In many historical cases, the first 2 – 3 years see a dramatic surge in the annual number of solar storms.

And, in many cases, the repeated bombardment of Earth – with intensifying CMEs and magnetic particles – has coincided with increasing human aggression. The 80-Year Cycle appears to have impacted this as well. 1858/1859 ushered in an explosive period and the most dramatic solar storm of modern history – the ’Carrington Event’ of 1859.

1938/1939 ushered in another explosive solar period with several global-impacting storms lasting into 1943 (a worldwide radio blackout also occurred in 1947).

Will 2019 usher in another multi-year period of explosive solar activity? “

“As explained for years leading up to that time frame, the 70-Year Cycle is what I term the ‘Cycle of Kings’ or ‘Cycle of Governments’. It is often the duration of a leadership or governance of some form. It is how long one entity ’reigns’ before a shift unfolds…

NATO’s standing in 2019 – 2022, a complete 70-Year Cycle from its inception and early development in 1949 – 1952, could see some similar shifts. These ‘transitions of power’ are rarely quiet, rarely immediate, and rarely without incident – so the sharpest shift (which is still expected to take hold right around 2020/2021) is still to come.”

Natural Gas spiked to new highs in early-Nov. without turning its weekly trend up. That signaled the timing for a new wave down, projecting a drop to new lows and into Dec. 2019. Natural Gas now enters the time that has been in focus all year – when a 1 – 2 year bottom is most likely… broader cycles focus on 4Q ’19/1Q ’20…”

INSIIDE Track, December 2019

While all these broad, overriding cycles and trends are important, traders & investors deserve and need more specific analysis & strategies on which to act. That is what INSIIDE Track and the Weekly Re-Lay attempt to continuously provide. In this case, the focus was on the broader cycles and 2 – 3 year price swings that repeatedly recur in Natural Gas. The stage was set… and soon would be time for action!

Natural Gas was reaching major support, and its multi-year downside target at 1.600 – 2.000/NG (stemming from sell signals in late-2018), ushering in the time and price when long-term short positions should be covered and multi-year long positions and hedges should steadily be initiated between 1.600 – 2.000/NG, projected to ultimately rally to ~5.000/NG (1 – 2 year target) and then to 8.500 – 9.500/NG (2 – 3 year target). An initial advance was forecast, at that time, to carry into Nov/Dec ’20 and up to ~3.500/NG (Natural Gas bottomed near 1.600 and rallied into Nov ’20, peaking near 3.500/NG)…

01-04-20 – “Natural Gas is fulfilling ongoing analysis for a 1 – 2 year bottom to take hold in 4Q ’19/1Q ’20, ideally in Dec. ’19/Jan. ’20. 1 – 2 year traders and hedgers can begin buying at these levels and average into long positions if lower levels are seen in the short term.”

01-31-20 – “Natural Gas is fulfilling ongoing analysis that has been discussed since late-’18/early-’19. That outlook called for Natural Gas to ultimately decline into 4Q ’19/1Q ’20… 1 – 2 year traders and hedgers can be phasing into long positions, and/or covering long-term short positions, at these levels.”

02-28-20 – “Natural Gas is fulfilling ongoing analysis for a drop from 4Q ‘18 into 4Q ’19/1Q ’20. 1Q ’20 is the latest phase of a 4-year low-low-low cycle with multi-year support near 1.6000 – the March ’16 bottom. 1 – 2 year traders and hedgers can be phasing into long positions, and/or covering long-term short positions, down to this major support.”

03-31-20 – “For the past year, much of INSIIDE Track’s focus has been on the extremely challenging time that was expected to begin in late-2019. That outlook was based on a myriad of factors, including:

— Geopolitical (projected to intensify in Nov. ‘19 – late-’20 and impact all kinds of markets)…

— Solar-related (Solar Cycle 24 was heading into its low point with Solar Cycle 25 expected to bottom in late-2019 – a transition that historically times dramatic global challenges, most recently in 2008/09)…

— Interest rate-related (rates projected to drop from late-’19 into June/July ‘20, based on to-be-determined negative economic forces)…

— Energy-related (Crude projected to drop to new multi-year lows based on its monthly trend pattern while Natural Gas was projected to decline into 1Q ‘20 before a multi-year bottom was/is likely)…

Natural Gas has fulfilled ongoing analysis for a drop from 4Q ‘18 into 1Q ’20. 1Q ’20 is the latest phase of a 4-year low-low-low cycle with multi-year support near 1.6000 – the March ’16 bottom… 1 – 2 year traders and hedgers can be phasing into long positions, and/or covering long-term short positions, down to this major support.”

INSIIDE Track, April 2020

04-30-20 – “Natural Gas has fulfilled ongoing analysis for a drop from 4Q ‘18 into 1Q ’20. 1Q ’20 is the latest phase of a 4-year low-low-low cycle with multi-year support near 1.6000 – the March ’16 bottom. Natural Gas rallied into mid-April and right to its intermediate upside target at 2.100/NGM. That triggered a pullback, expected to bottom in the coming week.

An overall rally… ultimately into Nov./Dec. ’20 is expected. It would take a weekly close above 2.400/NGQ to signal the next phase of this developing advance. 1 – 2 year traders and hedgers can be phasing into long positions, and/or covering long-term short positions, down to this major support.”

05-29-20 – “Natural Gas initially surged after fulfilling multi-year cycles that bottomed in 1Q ’20 – the latest phase of a 4-year low-low-low cycle. An overall rally into Nov./Dec. ’20 is expected, with an intervening low likely in the first half of June.

1 – 2 year traders and hedgers could have phased into long positions, and/or covered long-term short positions, during 1Q ‘20 (down to major support near 1.600/NG) and can be holding these longs/hedges.” FUTURES TRADING INVOLVES SUBSTANTIAL RISK!

06-30-20 – “Natural Gas initially surged into May (to new multi-year highs) after fulfilling multi-year cycles that bottomed in 1Q ’20 – the latest phase of a 4-year low-low-low cycle. It has since retraced 50% of that surge and is positioning for a new advance. An overall rally into Nov./Dec. ’20 is expected.

Throughout this basing period, INSIIDE Track and the Weekly Re-Lay provided the technical & cyclical outlook (for Natural Gas surges into Nov/Dec ’20, 3Q ’21, and ultimately into 2Q/3Q ’22) AND repeatedly discussed a ‘Perfect Storm’ of fundamental factors (geopolitical and economic as well as natural) that was expected to corroborate these cycles and spur the largest advance in over a decade. Something similar is possible again… in the not-too-distant future.

While projected Middle East tensions and global temperature increases were part of that discussion, the biggest factor was Eric Hadik’s emphatic and repeated assertion that inflation was about to take hold and spur the first two (of multiple) upward surges in commodity prices – first from 2Q ’20 into mid-2021 and then from 3Q ’21 into 3Q ’22. (The third one is still to come!)

The August ’20 INSIIDE Track elaborated on that while again stressing the multi-year buy signal that was being triggered in Natural Gas at 1.600 – 2.000/NG, projected to initially rally to ~3.500/NG (into Nov/Dec ’20) and ultimately to ~5.000/NG (1 – 2 year target) and then to 8.500 – 9.500/NG (2 – 3 year target). It explained why these expectations were not unprecedented and had an intriguing historical parallel when another multi-year period of inflation emerged:

07-30-20 – “Outlook 2020/2021 – Cycle Synergy; The More Things Change…

The period between March 16 – 23, 2020 – when a powerful convergence of daily, weekly, monthly & multi-year cycles bottomed in multiple markets – and April/May 2021 (when corresponding cycles are projected to peak in a broader collection of markets) – has been forecast to witness an inflationary surge in stocks, Silver and many other markets.

That has been forecast, not surprisingly, to coincide with a 12 – 14 month decline in the US Dollar – a sell-off that was/is likely to resemble the 2017 drop. It has a primary downside target of ~89.00/DX… If the Dollar is able to reach that level by Jan. 2021, it will perpetuate a decades-long pattern of Dollar declines during Republican administrations and advances during Democratic administrations – peaking in Jan. 2017 and declining into Dec. ‘20 or Jan. ‘21…

40YC of Inflation?

Getting back to the outlook for March ‘20 into May ‘21, three of the most significant forecasts have been powerfully validated in recent months. They are:

— New surge in stocks, after they fulfilled the Perfect Storm of Sell Signals triggered and described in late-Jan./early-Feb. ’20 and completed 2-Year & 40-Year Cycle declines on March 23, 2020.

That sell-off also fulfilled the ~11-Year Cycle of Stock Panic Cycles, ~11-Year Cycle of Global-Shaping Events and the 8-month & 16-month cycles that peaked in late-Jan. ’20 and projected sharp 1 – 3 month declines to follow.

Consistent with a majority of those factors, most stocks were forecast to set 6 – 12 month (or longer) lows by/on March 23 and then enter new advances that should ultimately carry them higher into April/May 2021 – the next phase of the 16-month cycle and another significant phase of the 40-Year Cycle. Multi-month buy signals were triggered on March 18 – 23.

— A major surge in Silver that was forecast to bottom on March 16 – 20, 2020 – along with an uncanny web of powerful cycle lows – and then enter a 12 – 14 month period where its gains were/are projected to substantially outpace the gains in Gold – even as all precious metals (and XAU) entered the culminating, often accelerated, phase(s) of a 5 – 6 year uptrend. A multi-month buy signal was triggered/published.

(In mid-March, Gold bottomed near 1450/GC while Silver bottomed near 12.00 – a ratio of ~120/1. This week, Gold spiked up near 2000/GC while Silver reached 26.00/SI – dramatically reducing that ratio to ~77/1 while validating the outlook for March ’20 – May ’21 to see proportionately greater gains in Silver as precious metals entered the most intense phases of their projected 2016 – 2021 advances.)

— US Dollar cycles peaked in March 2020 and projected an overall decline into 1Q/2Q 2021 that could easily take it to new multi-year lows (lowest levels since at least late-2014).

Not only would that fulfill multiple monthly and yearly cycles, it would also complete a 50% retracement in time of the Dollar’s 2008 – 2016 advance (105/106 months up followed by 52/53 months down).

When the three of those are combined, they show the potential for an inflationary advance from late-March ’20 into May ’21. Lower Dollar. Rising metals (precious and industrial). Rising stocks.

Add in massive government spending, to deal with a pandemic that is still out of control and the resulting economic debacle, and you have the fundamental factors for a declining Dollar and rising price inflation. This does NOT mean we are returning to the late-1970’s. The current environment is much different.

However, it does reinforce that this culminating period – of a 5 – 6 year uptrend in Gold, a 5-year (from early-2016) and 10 – 12-year uptrend in equities, and a 3 – 5 year corrective phase in the US Dollar – could/should see accelerated phases as most cycle crescendos do. More on those outlooks to follow…

Natural Gas surged into May (to new multi-year highs) and then retraced 50% of that advance, setting the stage for a new rally. That is taking hold but it needs a weekly close above 2.9000/NGZ to reinforce analysis for an overall advance into Nov./Dec. ’20.

INSIIDE Track, August 2020

The September 2020 INSIIDE Track continued on the projections for a multi-year surge in inflation (and Natural Gas) and updated the multi-month buy signals that had also been triggered in stocks and Silver during late-March ’20. That was forecast to coincide with a Dollar decline – projected to last until May 2021 – triggering the early phase of a much larger inflationary cycle:

08-29-20 – “Outlook 2020/2021 – 40-Year Cycle of Inflation

There has been one primary, overriding expectation for the current 12 – 14 month period. It has been discussed in respect to multiple markets and has just received some noteworthy (Fed) validation. Before elaborating on that, let’s review a few key factors:

1 – The 12 – 14 month period being addressed was identified as beginning on March 16 – 23, 2020 – when a powerful convergence of daily, weekly, monthly & multi-year cycles bottomed in multiple markets like stocks and Silver – until April/May 2021. That is when corresponding cycles are projected to peak in a broader collection of markets and culminate the period in focus.

2 – The primary expectation/projection for this period has been an inflationary surge in multiple commodities, precious/industrial metals, foodstuffs, and even equity markets. It has been forecast to be a synergistic, though sometimes staggered rally.

3 – Coinciding with, and potentially causing, that was the forecast for a 12 – 14 month decline in the US Dollar – a sell-off that was/is likely to resemble the 2017 drop and reinforce the decades-long pattern of Dollar declines during Republican administrations and advances during Democratic administrations.

The US Dollar peaked in Jan. 2017 and could drop into Dec. ‘20 or Jan. ‘21 – a slow but overall decline that would encompass the entire administration. Since this is often the driving force for inflationary moves, it is important to review the cycles governing the larger swings (1 – 2 years or more) in the Dollar…

In one single week, two diverse but sometimes corresponding measures of ‘inflation’ converged. One signaled the onset of what could be a larger phase of commodity price inflation while the other could be timing the finale in a broad period of paper-asset inflation…

Inflationary Starting Pistol…

With so many metals then fulfilling major downside objectives, as well as multi-month & multi-year cycle lows, the buy signals generated in March 2020 set the stage for a significant uptick in price inflation that was forecast for March ‘20 into May ‘21.

The Dollar concurred, peaking on March 19 and entering what is likely to be a 12 – 14 month decline. Stock Indexes reinforced that, bottoming on March 18 – 23 in sync with the 40-Year & 2-Year Cycles and triggering their own multi-month buy signal.

As is usually the case, cycles and technical analysis fired this ‘starting pistol’ WAY before fundamentals revealed anything remotely similar. In most cases, a fulfilling fundamental factor will not materialize until the middle third of a move or trend.

So, if this trend was forecast to last from March ‘20 into May ‘21, the middle third of that ~14-month time period is roughly mid-Aug.- late-Dec. ’20. And that brings us to the key event of the past week (from a financial perspective).

40YC of Competing Inflation

40 years ago, inflation was considered the ultimate evil in the financial markets as 1980 was experiencing the culmination of a 3 – 5 year and 5 – 10 year surge in commodity and precious metals’ prices – a parabolic move that was crippling the economy.

Paul Volcker set the Federal Reserve into overdrive to combat that inflation.

Fast-forward to the present when the concern is suddenly that there is not enough inflation. So, Jerome Powell just announced a new Fed approach that would (paraphrased) help nurture moderate inflation.

Be Careful What You Wish For!

As is the case with so many cycles, the extremes (beginning and end of that cycle) often time opposing extremes – the beginning of one move and the end of another… or vice-versa.

In this case, 1980 marked the culmination of an incredible inflationary cycle… and ushered in a 40-Year Cycle of Inflationary Vigilance.

40 years later, 2020 marks the onset of what could be a new inflationary cycle – with the first phase unfolding from March ‘20 into April/May ‘21.

There is another irony at play here. It should be watched closely over the next couple years. The culmination of commodity inflation – peaking in 1980 – paved the way for a near 40-Year Cycle of Paper Asset Inflation with stocks and bonds beginning massive bull markets… in 1981 and 1982.

Could 2021 and 2022 provide contrasting action – showing that those bull markets have peaked?

Inflationary Scares?

A myriad of overlapping cycles have been forecasting price inflation – in diverse commodities and precious metals – between late-March ‘20 and May ‘21.

The following is a small sampling of the commodities forecast to experience sharp rallies in 2Q ‘20 – 2Q ‘21 – bottoming in a staggered manner and expected to subsequently top in similar fashion.

One of those was Lumber, which bottomed in 2009 and set a secondary low in 2015. Leading into 2020, Lumber was projected to set another higher low in 2Q ’20 – ushering in a ‘3’ of ‘3’ of ‘3’ wave advance projected to take hold in May ’20 and last into 1Q ’21.

In order to validate that scenario, Lumber was forecast to set an initial peak above 440.0/LB in Feb. and then correct – setting the stage for a new bull run to take hold in May ’20…

Lumber followed that scenario pretty closely, spiking above 440.0 as it peaked in Feb. ‘20… and then plunging into early-April. It vacillated near its lows in April, awaiting bullish cycles to arrive in May ‘20 – at which time Lumber embarked on its new bull run. Little did anyone realize what kind of impact Covid-19 would have on lumber demand in May – Aug. ‘20…

Another bout of commodity price inflation was forecast for the grain markets with Soybeans forecast to see an initial surge into early-July and a larger overall surge into Sept. ‘20. The price action of the coming weeks will have to clarify if Sept. ‘20 will time the completion of this surge… or just an interim peak.

Then there is another key market that was projected to set a multi-year bottom in 1Q ‘20 and undergo an initial surge into Nov./Dec. ‘20.

03/31/20 – “For the past year, much of INSIIDE Track’s focus has been on the extremely challenging time that was expected to begin in late-2019. That outlook was based on a myriad of factors, including…

Natural Gas has fulfilled ongoing analysis for a drop from 4Q ‘18 into 1Q ’20. 1Q ’20 is the latest phase of a 4-year low-low-low cycle with multi-year support near 1.6000 – the March ’16 bottom.

A rally into June/July ’20 and ultimately into Nov./Dec. ’20 is expected. 1 – 2 year traders and hedgers can be phasing into long positions, and/or covering long-term short positions…”

Natural Gas set its lowest daily close on Feb. 28 and intraday low on March 9 – repeatedly testing 1.550 – 1.600/NG, where major support existed. It initially surged into May ‘20 and then pulled back into early-July. That ushered in the second phase of Natural Gas’ projected 2020 surge.

Most people associate Natural Gas demand with cold weather and the need for a widely-utilized heating fuel. However, Natural Gas was projecting multiple surges for April – Nov./Dec. ‘20, revealing something more. Ironically, it was the recent heat wave that spurred the latest demand for Natural Gas as power plants utilize it to keep up with the cooling demand.

When is the next inflationary wave likely to take hold?...

Natural Gas remains positive after triggering a combination of bullish multi-week signals on July 20 – 24 (including an outside-week/2 Close Reversal buy signal after testing its rising weekly 21 Low MAC).

Those signals projected a new rally that was forecast to last through August and ultimately into Nov. ’20 (in sync with the 2020 outlook for a major advance from a multi-year bottom in 1Q ’20 into Nov./Dec. ’20).

Intermediate cycles and wave comparisons project a multi-week peak on Aug. 31 – Sept. 4 with an initial target at 3.1500 – 3.2650/NGZ and a more extreme target near ~340.0/NGZ.

A peak in early-Sept. would also fulfill a ~4-month high (Jan. 6) – high (May 5) – high (Sept. 4/8) Cycle Progression. That would likely usher in a few weeks of consolidation with a subsequent low ideally taking hold in late-Sept… and setting the stage for another surge into Nov./Dec. 2020,

INSIIDE Track, September 2020

INSIIDE Track continued to update Natural Gas traders on how best to take advantage of a projected 2 – 3 year surge in prices… beginning with the initial phase, forecast to carry prices higher into Nov/Dec ’20. Traders were also updated on how, when, and where to add to long positions on a subsequent pullback:

09-30-20 – “Natural Gas remains on track for an overall advance from 1Q ‘20 into Nov./Dec. ’20. It reached a range of targets in Sept. (3.2650 – 3.4000/NGZ) and then corrected – with intermediate support now at 3.000 – 3.050/NGZ. Natural Gas was expected to set its next low in late-Sept, although that could stretch into the opening days of Oct. As long as it does not give a weekly close below 3.000/NGZ, Natural Gas should quickly resume its advance in Oct.

10-30-20 – “Natural Gas remains on track for an overall advance from 1Q ‘20 into Nov./Dec. ’20. It is resuming that uptrend and could surge to 3.600 – 3.700/NG in the coming weeks.

11-30-20 – “Natural Gas entered a large-scale correction after fulfilling the 2020 outlook for a major advance from 1Q ‘20 into Nov./Dec. ’20. It made it to its primary upside target (~3.400/NG) but could not stretch that to its extreme target near 3.700/NG. Since peaking, Natural Gas has retraced 50% of its March – Nov. advance, setting the stage for a ‘2’ wave bottom…

1 – 2 year traders and hedgers could have phased into long positions, and/or covered long-term short positions, during 1Q ‘20 (down to major support near 1.600/NG) and can add or enter new longs near current levels.” FUTURES TRADING INVOLVES SUBSTANTIAL RISK!

01-04-21 – “Natural Gas retraced 50% of its initial advance, after attacking its primary upside target (~3.400/NG) and peaking during multi-month cycle highs in Nov. On a continuous basis, it just tested its flattening monthly 21 High MAC – reinforcing that a secondary bottom is forming. A new 3 – 6 month (or longer) advance is expected to begin now and unfold in 2021.

1 – 2 year traders and hedgers could have phased into long positions, and/or covered long-term short positions, during 1Q ‘20 (down to major support near 1.600/NG) and can be adding or entering new longs near current levels.”

01-29-21 – “Natural Gas retraced 50% of its initial advance, bottoming at 3 – 6 month support near 2.300/NG. On a continuous basis, it is testing its flattening monthly 21 High MAC – reinforcing that a secondary bottom is forming, perceived to be the early stages of a major ‘III’ wave advance (with the ‘III’ – ‘V’ waves expected to last into 1Q ’22). A new multi-month advance is expected to begin now…

02-27-21 – “Natural Gas surged to new highs and has since corrected after peaking in precise alignment with its weekly trend, weekly LHR, daily cycles, and the latest phase of a 16 – 18 week low-low-high-(high) Cycle Progression.

It subsequently dropped to its early-Jan. peak (resistance turned into support) while fulfilling an 8-week high-high-low-(low) Cycle Progression (Feb. 24 – 26) and could be setting an intermediate low.

On a broader basis, Natural Gas is fulfilling the early stages of an expected major ‘III’ wave advance (with the ‘III’ – ‘V’ waves expected to last into 1Q ’22)… If/when Natural Gas gives a weekly close above 3.400/NG, it would project an advance up to 4.300 – 4.500/NG…

1 – 2 year traders and hedgers could have phased into long positions, and/or covered long-term short positions, during 1Q ‘20 (down to major support near 1.600/NG) and could have added or entered new longs near 2.500 – 2.600/NG in Dec. ‘20.” FUTURES TRADING INVOLVES SUBSTANTIAL RISK!

Little changed in that outlook (for higher prices into 2022) or trading strategy in the ensuing months, as Natural Gas was approaching its primary upside target for 2021 (~5.000/NG) and upper extreme target for 2021 (6.400 – 6.500/NG) – where a multi-month peak was most likely:

09-02-21 – “Natural Gas remains on track for an overall advance into 1Q ‘22, stemming from major lows in early-2020. After setting an initial peak in early-Aug. ’21, Natural Gas pulled back to intermediate support (~3.900/NGZ) and held – projecting a new advance that could easily reach 5.000/NGZ in the near term.

Multi-year traders & hedgers could have phased into long positions during 1Q ‘20 (down to ~1.600/NG) and added or entered new longs in Dec ’20 near 2.500 – 2.600/NG. Hold these into 1Q ’22.”

10-29-21 – “Natural Gas remains on track for an overall advance into 1Q ‘22, stemming from major lows in early-2020. After setting an initial peak in early-Aug. ’21, Natural Gas pulled back to intermediate support (~3.900/NGZ) and held – projecting a new advance that saw it surge to weekly & monthly extremes (~6.400 – 6.600/NG) in early-Oct.

That was expected to usher in a corrective period that is likely to stretch into mid-Nov and should prompt a pullback to at least 4.900, potentially 4.500 and possibly 4.000/NG before a secondary low is set.

The key was to keep traders/hedgers in long positions until Natural Gas had surged to its 2022 targets – where a multi-year peak was most likely. Cycles combined with the wave structure to project that advance to last into at least 3Q ’22.

At the same time, INSIIDE Track was reminding readers why War Cycles were forecast to emerge in late-2021 (an 80-Year Cycle that dates back to at least the 1200’s) and also impact energy prices…

01-05-22 – “As long as it does not give a weekly & monthly close below 3.390/NG, Natural Gas is still perceived to be in a wave ’4’ correction before a final wave ’5’ advance unfolds. This initial bull market was forecast to last from 1Q ’20 into 1Q ’22, at the very least. Natural Gas has the potential, however, to extend that into 4Q ’22 if support holds and it resumes its uptrend.

Multi-year traders & hedgers could have phased into long positions during 1Q ‘20 (down to ~1.600/NG) and added or entered new longs in Dec ’20 near 2.500 – 2.600/NG. Hold these until a monthly close below 3.390/NGH.” FUTURES TRADING INVOLVES SUBSTANTIAL RISK!

01-31-22 – “Natural Gas bottomed at downside extremes at ~3.390 – 3.540/NG (monthly 21 High MAC and multi-year ‘resistance turned into support’) and reversed higher, validating expectations for a wave ‘4’ low and the onset of a final wave ‘5’ advance.

This initial bull market was forecast to last from 1Q ’20 into 1Q ’22, at the very least, but Natural Gas has the potential to extend that into 4Q ’22.

02-28-22 – “Natural Gas surged to new contract highs after fulfilling expectations for a wave ‘4’ low (Dec ’21) and the onset of a final wave ‘5’ advance. Natural Gas has the potential to extend this bull market into 4Q ’22…

Multi-year traders & hedgers could have phased into long positions during 1Q ‘20 (down to ~1.600/NG) and added or entered new longs in Dec ’20 near 2.500 – 2.600/NG. Hold these until a weekly close below 3.900/NGM.” FUTURES TRADING INVOLVES SUBSTANTIAL RISK!

As Natural Gas embarked on its perceived ‘5th’ of ‘5th’ wave rally (a culminating, often parabolic surge), readers were reminded that price action is the ultimate determining factor in all trading. As a result, trailing stops were finally being tightened – on an accelerated basis – as Natural Gas attacked its two major upside targets (~8.00/NG & ~9.50/NG)…

03-31-22 – “Natural Gas surged to new highs after fulfilling expectations for a wave ‘4’ low (Dec ’21) and the onset of a final wave ‘5’ advance. Natural Gas has the potential to extend this bull market into 4Q ’22 but a multi-month (penultimate) peak could soon take hold…

Multi-year traders & hedgers could have entered long positions during 1Q ‘20 (down to ~1.600/NG) and added longs in Dec ’20 near 2.500 – 2.600/NG. Hold these until a weekly close below 5.200/NGM.” FUTURES TRADING INVOLVES SUBSTANTIAL RISK!

04-29-22 – “Natural Gas has continued to surge to new highs after fulfilling expectations for a wave ‘4’ low (Dec ’21) and the onset of a wave ‘5’ advance… An initial high took hold in April but the daily trend and 21 High MAC are still showing strength… so another rally is possible.

Multi-year traders & hedgers could have entered long positions during 1Q ‘20 (down to ~1.600/NG) and added longs in Dec ’20 near 2.500 – 2.600/NG. Hold these until a daily close below 6.450/NGM.” FUTURES TRADING INVOLVES SUBSTANTIAL RISK!

05-27-22 – “Natural Gas has continued to surge to new highs after fulfilling expectations for a wave ‘4’ low (Dec ’21) and the onset of a wave ‘5’ advance… Multi-year traders & hedgers could have entered long positions in 1Q ‘20 (down to ~1.600/NG) and added longs in Dec ’20 near 2.500 – 2.600/NG. Hold these until a daily close below 7.600/NGU.” FUTURES TRADING INVOLVES SUBSTANTIAL RISK!

Once it reached 9.500/NG, Natural Gas was expected to enter a very volatile topping phase before entering its next major sell-off. As a result, it was time for long positions to be exited…

06-30-22 – “Natural Gas reached and held key upside objectives at 9.500/NG and projected a drop to at least 6.500 and potentially 5.500/NG. It has fulfilled both and could see some consolidation take hold. Multi-year traders & hedgers could have entered long positions in 1Q ‘20 (~1.600 – 2.000/NG) and added longs in Dec ’20 (~2.500 – 2.600/NG) and finally exited these positions in mid-June.” FUTURES TRADING INVOLVES SUBSTANTIAL RISK!

07-29-22 – “Natural Gas surged and retested its key upside objectives at 9.500/NG after fulfilling projections for a sharp drop to support at 5.500/NG. More volatile consolidation is likely. Multi-year traders & hedgers could have entered long positions in 1Q ‘20 (~1.600 – 2.000/NG) and added longs in Dec ’20 (~2.500 – 2.600/NG) and finally exited these positions in mid-June ‘22.” FUTURES TRADING INVOLVES SUBSTANTIAL RISK!

After reaching 9.500/NG while fulfilling multi-month and & multi-year cycles (Aug/Sept 2022), Natural Gas projected a subsequent sell-off that should take it down to – at the very least – 3.500/NG…

10-31-22 – Natural Gas has sold off sharply after fulfilling multi-month & multi-year cycles while surging for over two years into 3Q ’22 and attacking major upside price targets while completing a textbook 5-wave advance from its mid-2020 bottom.

(That peak coincided with the culmination of the 2-year buy signal that had investors entering longs in early-2020, adding to them in early-2021, and carrying them through the majority of that 2-year advance and finally exiting in mid-June ’22.)

By setting a peak in 2022, Natural Gas fulfilled an ~8.25-year high (4Q ‘97) – high (4Q ’05) – high (1Q ’14) – high (2Q ’22; which was not closed above) and an ~11-month high (Nov ’19) – high (Oct ’20) – high (Sept ’21) – (high; Aug 2022) Cycle Progression.

That ~11-month Cycle Progression was reinforced by an over-arching 22 – 23 month high (Dec ’16) – high (Nov ‘18) – high (Oct ‘20) – (high; Aug/Sept 2022) Cycle Progression.

Ultimately, this could drive the price of Natural Gas back down to ~3.500/NG – the 4th wave of lesser degree support (Dec ‘21 low before wave ‘V’ advance into Aug ‘22) & prior 4Q ‘20 high”

The rest is history.

Result

Natural Gas adhered very closely to this ongoing outlook for a Major, multi-year advance from multi-year cycle lows – in early-2020 – into the culmination of a myriad of cycle highs in 3Q 2022. It has been forecast to undergo a precipitous sell-off into 2023… when another decisive bottom is expected. Can Natural Gas enter a new multi-year advance… in 2023 or 2024? Stay tuned…

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