Gas Quant Weekly - Discretionary funds further trimmed their net-long position by over 20k lots in TTF

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Discretionary funds have significantly reduced their net-long positions in TTF, influenced by geopolitical uncertainties such as the Trump–Putin talks. Meanwhile, CTAs have shifted from maximum short levels to marginal buyers, adding persistent support to prices.

Additionally, the recent decline in net injections below the five-year seasonal average is creating pressure on recently added TTF winter short positions. In the Henry Hub market, option trades have led to net-long option dealer gamma positions, which have a stabilising effect on the futures market. Our insights delve into these developments, offering strategies to navigate the evolving landscape.

Key findings in this report:

• Discretionary funds further cut their net-long position in TTF by over 20k lots ahead of the Trump–Putin Alaska talks.
• CTAs, after being at maximum short levels, have turned into substantial buyers, with further buying levels between €34.00/MWh and €35.50/MWh.
• Recent strength in TTF and fall in net injections below the five-year seasonal average add pressure to winter short positions.
• Henry Hub options trades have led to net-long gamma positions from option dealers unhedged gamma positions, which have a stabilising effect on the underlying futures market.

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